Greece must stay in euro, OECD chief says

Greece must remain in the eurozone but may need extra time to make good on tough economic reforms it has promised international creditors, according to the secretary-general of the Organization for Economic Cooperation and Development, Angel Gurria.

In an interview with German newspaper Neue Osnabruecker Zeitung published on Saturday, the OECD chief joined the chorus of prominent economists supporting Greece’s continued presence in the single-currency bloc, on the condition that the government respects the conditions of its agreement with creditors. However, the Mexican said, Athens should be given some slack in meeting the tough terms in view of a deepening recession. “Perhaps the government needs more space to meet its commitments,” Gurria told the paper.

The OECD chief added that he was in favor of the European Central Bank buying the bonds of eurozone member states. “The president of the ECB, Mario Draghi, stated clearly that the ECB can ease the debt crisis in the eurozone through the purchase of bonds and I support this policy,” Gurria said. Draghi’s statements sent a “clear message to the markets,” the OECD chief said. “The speculators will lose their bet against the euro as the ECB is using all the means at its disposal.”

He added that countries with debt problems, such as Greece, should focus on pushing through the structural reforms that will allow them to gain competitiveness.

In June, Gurria said Greece should be allowed to renegotiate the terms of a 130-billion-euro bailout signed in February. The Greek government recently set aside its request for renegotiation of the deal, and for a two-year extension of the fiscal adjustment period, as it focuses on identifying budget cuts pledged to creditors. 

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