Will Friday's Turkish coup attempt lead to debt relief in Greece?

The US argues that the country needs help in the face of looming geopolitical threats...

Will Friday's Turkish coup attempt lead to debt relief in Greece?

Petros Giannakouris / AP

US Treasury secretary, Jack Lew, has said that action needs to be taken to create stability in Greece in the wake of increased instability in the south-east of Europe following Friday's attempted coup in Turkey and its aftermath.

Mr Lew has reiterated the US stance that Greece needs debt relief or restructuring to create stability in the Mediterranean state.

He said that he hoped that the events in Turkey would, "change the climate in which discussions of debt relief happen, just because it’s the right thing to do on its own, and at a time when Greece is in a position [of] geopolitical significance that’s a good time to reinforce their fiscal future," he told The Financial Times.

"You have to fix the foundation to have a strong Greece,” the US official added, while also calling on politicians in Athens to be more proactive in introducing the economic reforms required to secure new funding to stabilise its struggling economy.

Mr Lew highlighted the importance of stability in Greece as it plays a vital role in the policing of the movement of migrants into Europe.

The roll-out of Greece's latest bailout has been complicated by a growing rift between two of its creditors, the European Commission and the IMF, with the later arguing that Greece needs debt concessions. These calls have been opposed by the Commission - and are particularly unpopular with German representatives.

"I think we have crossed a threshold in that there’s been broad agreement that there does need to be debt restructuring," Mr Lew told the newspaper, adding that agreeing the details of such a deal will be difficult.

 

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