Greece wants debts kicked into the future - Varoufakis
Published 15/05/2015 | 02:30
Repayment of what Greece owes to the European Central Bank should be pushed into the future, but it is not an option because it fills ECB president Mario Draghi's "soul with fear", Greece's finance minister said,
Yanis Varoufakis said yesterday that Mr Draghi cannot risk irritating Germany with such a debt swap because of Berlin's objection to his bond-buying programme.
Mr Varoufakis first raised the idea of swapping Greek debt for growth-linked or perpetual bonds when his leftist government came to power earlier this year. But Athens has since dropped the proposal after it got a cool reception.
The Greek minister, who has been sidelined in talks with European Union and International Monetary Fund lenders, brought it up again yesterday, saying €27bn of bonds owed to the ECB after €6.7bn worth are repaid in July and August should be pushed back.
"What must be done (is that) these €27bn of bonds that are still held by the ECB should be taken from there and sent overnight to the distant future," he told parliament.
"How could this be done? Through a swap. The idea of a swap between the Greek government and the ECB fills Mr Draghi's soul with fear. Because you know that Mr Draghi is in a big struggle against the Bundesbank, which is fighting against QE. Mr Weidmann in particular is opposing it."
Mr Varoufakis was referring to ECB quantitative easing (QE) that Bundesbank President Jens Weidmann's opposes.
Mr Varoufakis said the QE plan is "everything for Mr Draghi" but that "allowing such a swap of our own new bonds with these bonds ... would feed Mr Weidmann with excuses to create problems with QE."