Greek Premier pleads for ‘viable’ banks’ haircut

BELGIUM: Greek Prime Minister George Papandreou pleaded late Sunday for a “viable” write-off for his country’s debt, as Europe and the IMF struggled with negotiations on a so-called ‘haircut’ of at least 50 percent.

“There is a willingness to face this challenge in order to get a viable solution,” Papandreou said after day-long summit talks with fellow European Union and eurozone leaders in Brussels.

He spoke after Greece’s former European Central Bank deputy head Lucas Papademos warned in Athens that a 50-percent write-off would only in reality result in a 20-percent cut to Greece’s some 350-billion-euro debt mountain ($487 billion).

Papandreou told a news conference after the EU talks ended that Greece needed a “viable solution to the Greek debt - especially on the participation by private Greek banks,” pension funds and insurance firms.

Between them, these creditors hold nearly 30 percent of central government debt - and losses there would have to be offset by the cash-strapped Greek state.

Xinhua