Economy ECB governor: Greece and creditors need clear dialogue

ECB governor: Greece and creditors need clear dialogue

European Central Bank Governor Mario Draghi
European Central Bank Governor Mario Draghi

 (AA) – European Central Bank Governor Mario Draghi has stated that a “process for policy dialogue between Greece and its creditors is needed” amid the ongoing dispute between the two sides.

Testifying before the European Parliament Committee on Economic and Monetary Affairs on Monday, Draghi said the bailout plan between the “troika” — comprising the IMF, European Central Bank and European Commission — and Greece was on track and that the ECB was continuing to play its role in the plan. 

Asked if the ECB was “blackmailing” Greece, Draghi answered: “We have €104 billion exposure to Greece. It was 50 in December. So, are we blackmailing Greece?

“On the contrary, Greece and its international partners should now work to successfully complete the bailout plan.”

Asked why challenges like that of the Greek bailout had arisen, Draghi said: “Monetary union is incomplete, and must be completed by fiscal and political union in the future.

“Whether this happens soon, or a long time from now, I cannot say.”

– ‘Prices to remain low’

Draghi also insisted on the success of the ECB’s stimulus program, which is injecting €60 billion in bond and securities purchases every month.

“Economic growth in the region is picking up pace, but consumer prices are expected to remain at current very low or negative levels for the near future … Inflation will increase towards the target of less than two percent by year-end,” Draghi said.

The current quantitative easing program was intended to last at least until end-September 2016, he added.

“We have had low inflation for such a long time that there is an inborn inertia in this indicator. But our monetary policy and changes in the exchange rate will both help reduce inflation,” Draghi said.

The euro rose to 1.09 against the dollar after Draghi’s testimony, from levels of about 1.07 earlier in the day.

Previous articleObama seeks foreign investment as US economy grows
Next articleTurkey urges G20 states to act to reduce poverty