The Greek government is veering away from a debt haircut but instead wants a “menu of debt swaps,” according to FinMin Yanis Varoufakis’ statements to the Financial Times.

The “Debt exchange” will include two new types of bonds.

Firstly, one type will be indexed to nominal economic growth, replacing European rescue loans, while the second, which was – according to the Financial Times – classified as “perpetual bonds” would replace ECB-Owned Greek Bonds.

According to Varoufakis this debt swap idea would be a way of “smart debt engineering” that would move away from the term “haircut”, which is so disliked by creditors such as Germany, and is a less-than-popular term for taxpayers of creditor countries.

According to the FT, Mr. Varoufakis stated:

“What I’ll say to our partners is that we are putting together a combination of a primary budget surplus and a reform agenda […] I’ll say, ‘Help us to reform our country and give us some fiscal space to do this, otherwise we shall continue to suffocate and become a deformed rather than a reformed Greece’.”