Greek debt restructuring is inevitable, says IMF chief

JUL 29, 201511:50 PM

[WASHINGTON] Greece's international creditors will have no choice but to accept an easing of the terms of Athens' debts, the head of the International Monetary Fund said on Wednesday.

"It's inevitable that there is an element of debt restructuring," IMF Managing Director Christine Lagarde said at a news conference.

The IMF has teamed up with the European Union and the European Central Bank in recent years to lend Greece money repeatedly to save it from a debt crisis.

The IMF and the United States argue that Greece's loan burdens are unsustainable and have advocated for an easing of some of the terms of Greece's debts to international creditors. European governments have resisted the idea as they negotiate with Athens on further bailout funds.

"For Greece to succeed and for any program to fly, a significant debt restructuring should take place," Ms Lagarde said.

In wide-ranging comments, Ms Lagarde said Ukraine appeared to be making progress in talks with private creditors to restructure its debts.

She also said China's policy efforts to fight a plunge in its stock market were unlikely to affect the IMF's decision on whether to include the yuan currency in its special drawing rights basket of currencies.

"Is that going to impact our assessment of the drawing rights basket? I don't think so," she said. "We will continue to do the work, and I don't think we'll be unduly derailed by some market variations that we've seen recently."

REUTERS