Debt relief measures to cost 34 bln euros

Debt relief measures to cost 34 bln euros

The German government has calculated the cost of the measures easing Greece’s debt over the next 10 years at 34 billion euros, though that depends on the course of interest rates, the Frankfurter Allgemeine Zeitung daily reported on Wednesday citing a German Finance Ministry document.

“The [cost] of the additional suspension of interest payments in the next 10 years will depend on the actual fluctuations of interest rates and is currently estimated by the [German] Finance Ministry at 34 billion euros,” the ministry is reported to have responded to a parliamentary question.

It follows the Eurogroup decision last month for the further extension of Greece’s grace period by a decade and the extension of the average maturity period of loans to Athens, also by 10 years.

Germany is for now blocking the disbursement of the last bailout tranche to Greece, amounting to 15 billion euros, due to the arbitrary decision by the Greek government to extend the value-added tax discount on the five Aegean islands suffering the most from the migrant influx. The European Stability Mechanism has announced that the tranche will be disbursed after the German parliament approves it next month.

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