EU mulls Greek ‘haircut’ to cut huge deficit

Eurozone finance ministers are considering a possible 'haircut' for Greece in 2015, a German newspaper reported Sunday, in a bid to reduce the debt mountain of the recession-wracked country. Other eurozone countries and institutions like the European Central Bank could be ready to discuss writing down a part of their Greek debt holdings to put Greece's debt on a more sustainable footing, said the Welt am Sonntag. The issue was discussed at a secret meeting of ministers and officials in Paris.

A haircut may be used as a sop for Greece to carry out reforms needed in its second aid package, which runs out in 2014, according to the Welt am Sonntag. Germany has been firmly opposed to taking a loss on its holdings of Greek debt, unwilling to ask German taxpayers to foot the bill.