The EU and the IMF have allowed Greece to repay its debts over a longer period – but this will inevitably lead to overspending and in the end bigger debts.
The IMF itself is worried about this and the deal is contingent on Greece buying back its ten-year bonds from private investors at current market rates. As these are only one-third of their original value, this would amount to a two-thirds default on these debts.
Apparently Germany is now resigning itself to the fact that most, if not all, of Greece’s debt will eventually have to be written off (along, presumably, with the Greek economy). ■