‘Eurogroupie’ Dijsselbloem not haunted by guilt over Greek debt consequences

The size of Greece’s primary budget surplus was the among topics of discussion at a meeting on Friday of key players in the country’s bailout and reform program, the head of the Eurogroup of euro zone finance ministers said.

Speaking in The Hague, Eurogroup president Jeroen Dijsselbloem confirmed the meeting would take place in Brussels but dismissed any suggestion that Athens’ bailout program was in crisis.

A review by creditors of Greece’s performance since its mid-2015 bailout has dragged on for months longer than planned, and all sides are hoping for progress before a Feb. 20 meeting of the Eurogroup.

“The story that there’s a crisis (is) roundly exaggerated,” said Dijsselbloem, who is also Dutch finance minister.

“The next large payment that Greece needs to make (on its debt) isn’t until this summer. But if I can give them a push today, that would be of course be very welcome.”

He insisted, however, that “the discussions today are not about debt easing”, repeating the Dutch and German governments’ position that further debt relief for Greece will only be possible in 2018 after its current 86 billion euro bailout program is completed.

Greek and European bond yields have risen in the past 24 hours amid fears that a split between European governments and the International Monetary Fund over further debt relief for Greece will prove difficult to resolve.

The IMF is pushing for a clear plan to reduce Greece’s overall debt load, which it views as unsustainable. It wants the primary surplus, which excludes interest payments, required under the bailout deal lowered to 1.5 percent from 3.5 percent as a condition for its continued participation in the program.

But euro zone countries led by Germany have insisted that Greece can achieve the higher surplus. Germany and the Netherlands also both say that any further Greek debt relief can come only in the form of lower interest rates and extended time to pay back loans, not forgiveness of any principal.

The Dutch and German governments have also said, however, that they will not continue with Greece’s bailout program unless the IMF continues to participate.

With Dutch national elections on March 15 and German elections later in the year, observers worry it will be difficult for either government to make concessions if they are needed to keep the Greek program in place.

“What is on the table today is the (Greek) budget, the primary surplus, and further reforms to the pension system,” Dijsselbloem said.