Finance Ministry claims negotiations did not increase Greek debt
Unnamed sources from the Ministry of Finance had denounced the allegations that…
Unnamed sources from the Ministry of Finance had denounced the allegations that the government negotiations resulted in an increase of the country’s debt, challenging doubters who argue the real economy suffered to look into statistics on employment.
According to the Ministry sources, the claim on the debt increasing comes from the erroneous belief that the third bailout’s 86 billion euros are new debts. The sources explained that:
- 54 billion euros will go towards refinancing the old debt
- 25 billion euros has been set aside for the bank recapitalization; only 5 billion euros were needed though, as recognized by the Governor of the Bank of Greece
- 7 billion euros will go towards arrears of the Greek state
Furthermore, the Finance Ministry sources cite a analysis by British journalist Hugo Dixon, who estimated that the favorable terms of the new loan will see the Greek debt slashed by 40 billion euros.
Indicatively the Ministry sources argue that the public records show that Greece’s debts at the end of 2014 amounted to 324 billion euros and at the end of 2015 to 321 billion euros.