April 30, 2011
Two German government advisers see a debt restructuring by Greece as inevitable while two of the overborrowed country's ministers continued to rule it out in newspaper interviews on Saturday.
Mounting fears that Greece will have to restructure a debt mountain expected to reach 340 billion euros this year, roughly one and a half times its output, have pummeled Greek bonds, driving yield spreads over German bunds to new record highs.
"For me restructuring is the only road to take, for Greece to feel some relief and for creditors to contribute to the solution of the Greek problem," Lars Feld, one of the five "wise men" who advise the German government on economic policy, told To Vima newspaper in an interview.
His view echoed that of Clemens Fuest, who chairs the German finance ministry's technical advisory committee. He told Greek paper Realnews the country must restructure its debt no later than April 2013.
"I don't think Greece can repay its debt without huge help from abroad, more than what one could reasonably expect. If there is no restructuring, uncertainty over the future of Greece's economy will delay its growth," Fuest said.