Greece sends officials to US as default fears grow

Tuesday, January 17, 2012
By Paul Martin

Greece has sent top officials to the US for talks with the International Monetary Fund as it returns to centre stage in the eurozone crisis over fears that a debt deal impasse with bondholders could trigger a messy default.

By Martin Strydom
16 Jan 2012

The Greek Prime Minister Lucas Papademos said on Monday he was confident agreement on a debt swap plan would be reached by the time eurozone finance ministers meet next Monday.

Greece has a €14.4bn bond maturing on March 20 that it can’t afford to pay in full.

A crucial second, €130bn rescue loan from the EU, IMF and ECB is dependent on reaching an agreement on a bond swap with creditors that are being asked to take a voluntary 50pc loss on their Greek government bonds.

Talks with private bondholders are said to be resuming on Wedesday after breaking up without a resolution on Friday.

“There is a little pause in these discussions. But I am confident that they will continue and we will reach an agreement that is mutually acceptable in time,” Mr Papademos said in an interview with CNBC.

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