Greece’s central bank governor has urged the country’s creditors to rework a core element of Athens’ new bailout, saying ambitious budget surplus targets agreed with the leftwing Syriza government are “unrealistic and socially unattainable.” Yannis Stournaras called for “a new deal” that would reduce the fiscal surplus, before debt payments, Athens must achieve — from 3.5 per cent to 2 per cent of national output — beginning in 2018. The lower target would allow “for a more balanced economic policy mix with emphasis on the reduction of taxation, encouraging private investment and contributing to sustainable growth rates,” Mr Stournaras wrote in an article published in the Financial Times. Mr Stournaras’s stance puts him in league with the International Monetary Fund, which has argued for months that the surplus targets are unrealistic. But it puts him at odds with both the German government and Alexis Tsipras, the Greek prime minister, who has been in an open war of words with the IMF about its efforts to revamp the programme.

Source: FT.com