European Central Bank executive board member Benoit Coeure told one of the leading international news agencies that the European regulator does not agree to restructure or cancel Greece’s debt. Benoit Coeure explained that such a step is impossible for legal reasons.
He also noted that making decision on easing the current debt crisis in Greece is beyond the mandate of the European Central Bank.
Syriza, which won the general election on January 25, made a demand for restructuring or writing off a part of the debt the country owes to foreign creditors. First of all, Greece requested the European Commission and the International Monetary Fund. The total value of Greece’s public debt exceeds 150 percent of GDP now. The debt crisis makes it difficult to pay off the debt and increase economic growth.
Greece experienced the most severe economic depression in the period between 2008 and 2014. The GDP contracted more than one quarter and the country was brought to the brink of default. Debts to private investors were readjusted. However, the bulk of loans remained overdue.
Before winning the election, Syriza declared its intention to develop the country’s monetary policy regardless of the results of the negotiations with the creditors. It used to be determined by the European Commission, the European Central Bank, and the International Monetary Fund.
