Stournaras insists on credit line

TAGS: Economy, Politics

The governor of the Bank of Greece, Yannis Stournaras, stood by his proposal for a precautionary credit line for the country after it exits its bailout program in August, saying that the institution he heads is independent and doesn’t “take instructions.”

Speaking at the Delphi Economic Forum on Saturday, Stournaras pushed back at government criticism of his insistence on a credit line, saying it will reduce the cost of borrowing and will maintain waivers for Greek banks.

His remarks came after Prime Minister Alexis Tsipras questioned the motives behind the calls for a precautionary credit line, saying that it contravenes the plans of the Greek government and international organizations.

Stournaras said Greece had in previous years willingly submitted part of its sovereignty to the eurozone and the European Central Bank, adding that the regulations mean the country has to remain under strong supervision until it repays 75 percent of its debt.

“I don’t see this as a problem. We got our lesson in the past and we cannot afford to take a step back,” he said. He also insisted that the Eurogroup must take clear-cut action as soon as possible in order to render Greece’s debt sustainable.

“Without this we are heading nowhere,” he said, noting that it would be more prudent for Greece to exchange the target of 3.5 percent primary surpluses until 2022 for lower targets and more privatizations.

Referring to his alleged involvement in the Novartis affair, he said the case is built on “lies of three unknown witnesses,” adding, “I feel sorry for the country.”