IMF ‘won’t join Greek bailout be­fore re­forms’

The China Post - - FRONT PAGE -

The In­ter­na­tional Mon­e­tary Fund (IMF) can­not par­tic­i­pate in another Greek bailout un­til Greece and its cred­i­tors make dif­fi­cult de­ci­sions on eco­nomic re­forms and debt re­lief, a fund of­fi­cial said Thurs­day.

Brief­ing re­porters on con­di­tion of anonymity, the of­fi­cial said Greece needs to com­mit to re­forms and cred­i­tors must pro­vide debt re­lief — ex­tend­ing loan terms or re­duc­ing the debt out­right — that will al­low Greece to pay its bills over time. “It’s al­ways been clear the IMF will only come in once these con­di­tions are in place,” he said, sug­gest­ing that point is months away.

Still, the fund is par­tic­i­pat­ing in on­go­ing debt talks.

In Athens, a gov­ern­ment of­fi­cial re­fused to com­ment di­rectly on the IMF’s par­tic­i­pa­tion in the third bailout.

“The IMF’s po­si­tion on debt sus­tain­abil­ity is not new. ( IMF man­ag­ing di­rec­tor Chris­tine) La­garde has re­ferred to this dozens of times,” the of­fi­cial said, ask­ing not to be iden­ti­fied be­cause the talks are on­go­ing.

The IMF has said Greece’s debts are likely to rise to 200 per­cent of its eco­nomic out­put in the next two years, a bur­den the fund calls un­sus­tain­able.

Greek Bailout Talks Shift into Higher Gear

Greece’s talks with its in­ter­na­tional cred­i­tors on a third bailout worth 85 bil­lion eu­ros (US$93 bil­lion) shifted into a higher gear on Fri­day, with lead ne­go­tia­tors from the Euro­pean Union and In­ter­na­tional Mon­e­tary Fund meet­ing key min­is­ters in Athens.

The talks with Fi­nance Min­is­ter Eu­clid Tsakalo­tos and Econ­omy Min­is­ter Gior­gos Stathakis fol­low prepara­tory meet­ings in the Greek cap­i­tal this week be­tween lower-level of­fi­cials on re­form­ing the tax sys­tem and la­bor mar­ket reg­u­la­tions.

The third bailout will in­clude a new pun­ish­ing round of aus- ter­ity mea­sures heaped on a coun­try reel­ing from a six-year re­ces­sion and more than 25 per­cent un­em­ploy­ment. Prime Min­is­ter Alexis Tsipras has pledged to back the new cut­backs, while openly ad­mit­ting that he dis­agrees with them.

“We will im­ple­ment them, yes, be­cause we are forced to,” he said in par­lia­ment Fri­day. “But at the same time we will strug­gle to change them, to im­prove them and to counter their neg­a­tive con­se­quences.”

The bailout talks with the IMF, Euro­pean Com­mis­sion, Euro­pean Cen­tral Bank and Euro­pean Sta­bil­ity Mech­a­nism must be con­cluded be­fore Aug. 20. That’s when a debt re­pay­ment to the ECB worth more than 3 bil­lion eu­ros is due — money which Greece does not have.

Fri­day’s meet­ings came hours af­ter Tsipras de­feated a bid by dis­senters in his left-wing Syriza party to push for an end to bailout ne­go­ti­a­tions and seek a re­turn to the old na­tional cur­rency, the drachma.

The party’s gov­ern­ing cen­tral com­mit­tee backed a pro­posal by Tsipras to hold an emer­gency party con­fer­ence in Septem­ber, af­ter the talks have been con­cluded.

Dis­senters had sought a con­fer­ence ear­lier, press­ing the gov­ern­ment to aban­don the ne­go­ti­a­tions.

Tsipras ef­fec­tively lost his ma­jor­ity in par­lia­ment in a vote three weeks ago, when nearly one-fourth of Syriza’s law­mak­ers re­fused to back new aus­ter­ity mea­sures, ar­gu­ing that the party has be­trayed the an­ti­aus­ter­ity plat­form that got it elected in Jan­uary.

“This coun­try no long has democ­racy, but a pe­cu­liar type of to­tal­i­tar­i­an­ism — a dic­ta­tor­ship of the euro,” prom­i­nent dis­senter Pana­gi­o­tis Lafaza­nis said.

Pro-Euro­pean Union op­po­si­tion par­ties were left to save the bill and have con­tin­ued to prop up his gov­ern­ment, while Tsipras has taken no dis­ci­plinary ac­tion against dis­senters.

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