ECONOMY

EIB chief confident of Greek bond buyback scheme

European Investment Bank chief Philippe Maystadt appears confident that the eurozone will buy back Greek bonds at going rates on the secondary market, in order to relieve some of its debt, whose costs are spiralling due to the bad rating.

“There is a proposal which is backed by the European Central Bank (ECB), by the European Commission, and which we are going to discuss, which would consist in enabling the European Financial Stability Fund (EFSF) to buy back Greek bonds at market rates,» he said on RTL TVI on Tuesday following a meeting of eurozone finance ministers on Monday.

“There is agreement on the aim, but no agreement yet on the means,» he added. ?The aim is clear: measures must be taken to make Greece’s debt sustainable, that is that the proportion of debt to GDP must be reduced

Maystadt also confirmed the likelihood of a special EU summit in the coming days to deal with the spreading debt crisis that has reached Italy and Spain.

“Markets abhor uncertainty,» he said. «When a situation is unclear markets think the worst. Therefore they must be reassured and it must be done with clarity.”

“That is why a clear, definitive solution to the Greek debt problem must be announced very quickly, putting a stop to contagion. That is why I hope that in the coming days heads of state and government will be able to clearly announce the road chosen to make Greek debt more sustainable.”