Germany and France hopeful for deal over Greece

Speaking a day after the International Monetary Fund (IMF) questioned the viability of current proposals, Germany’s Wolfgang Schaeuble said that a resolution between Athens and its official lenders could be struck following next weekend’s meeting of European finance ministers in Amsterdam.

Schaeuble said that even before arriving in Washington this week for the Spring Meetings of the IMF and World Bank “my optimism was already big.”

“And it surely hasn’t become smaller,” he added.

He did not detail how differences with the Greeks over their commitment to reforms — especially on pensions — and their need for debt relief would be resolved. 

Still, Schaeuble said, “it is the common will of all three institutions, the EU commission, ECB (European Central Bank) and IMF to negotiate with the Greek government on the basis of a unified position.”

“Everybody knows that the manoeuvring space for the Greek government is limited,” he said. “But all say at the same time Greece must do more and can do more.”

Also in Washington, France’s Finance Minister Michel Sapin said an agreement on Greece could come out of the Ecofin meeting in Amsterdam.

“It is crucial to resolve the Greek issue now or we will always be on the edge of a cliff,” he told reporters.

“We have taken advantage of the presence in Washington of many political and financial leaders to move forward.”

He stressed the need for the IMF, which has repeatedly expressed frustration with Greece and the EU after taking part in the previous two financial rescues for Greece, to take part again in funding the current plan.

“If the IMF is no longer on board it would weigh negatively on resolving the problem,” he added.

On Friday the IMF’s Europe Department chief Poul Thomsen said the Greek fiscal forecasts and debt relief plans currently under discussion might not be plausible.

IMF Managing Director Christine Lagarde met Friday with Greece’s Finance Minister Euclid Tsakalotos on the talks.

According to an IMF statement, Lagarde told him the Fund “remains ready to support an economic program for Greece that is based on sustainable, realistic measures and medium- and long-term fiscal targets, and is accompanied by the necessary debt relief from Greece’s European partners.”