ATHENS: Greece debt will miss debt targets set out by creditors in 2012 but an analysis prepared for euro zone finance ministers shows its debt burden is still sustainable without writing off principal — if Greece gets another three-year bailout.
The analysis, commissioned by the EU creditor governments to help their financing-for-reforms negotiations with Athens, concludes that even in the worst scenario for the Greek economy, the lenders would not have to write off any loans.
Debt relief has been a repeated request from the leftist government in Athens which wants to ease back on austerity. Under a 2012 bailout agreement, Greece was to reach a debt-to-GDP ratio of 124 percent in 2020 and in 2022 a debt-to-GDP ratio substantially lower than 110 percent, down from 175 percent now.
Under the revised forecast and the most optimistic scenario that Athens implements all reforms, Greek is debt to fall to 124 percent only in 2022 from 172.8 pct in 2015. If it implements the reforms only partially, Greek debt will fall only to 135 percent in 2022 from 174.3 pct in 2015.
