IMF puts pressure on both Athens and the eurozone
Sets reforms, debt restructuring as terms for its participation
The International Monetary Fund will not participate in a new bailout program for Greece unless the government agrees to and implements certain reforms, and the country’s eurozone peers agree to a restructuring of its debt, according to a report published yesterday in the Financial Times. A senior IMF official told Kathimerini’s Washington correspondent, Katerina Sokou, yesterday that while it has started talks on a new Greek program, negotiations cannot be completed unless there is a “specific and clear agreement on the lightening of the Greek debt,” which “will take some time.” The source added that talks are aimed at a reliable program which the Fund could support and has to meet two conditions: a debt settlement by the Europeans and reforms by Greece. Responding to the FT report, Finance Ministry sources said that “the IMF cannot participate in a new bailout program for Greece for now due to high state debt.” However, they stressed that the fund takes part as usual in the negotiations and that its position on the debt is not new, with Managing Director Christine Lagarde having repeatedly called for a reduction. Among the demands that the new IMF mission chief, Delia Velculescu, will present to Greek ministers today will reportedly be cuts to main and auxiliary pensions, the abolition of early retirement and cuts to civil servants’ salaries. The Romanian IMF official will participate in the first meeting of the heads of the creditors’ mission to Athens with the ministers of Finance, Euclid Tsakalotos, and Economy Giorgos Stathakis, probably in the formers’ hotel. The creditors are likely to demand a third package of prior actions to be voted through Parliament next month, which is something the government has already rejected and will likely lead to a clash between the two sides. Finance Ministry officials also said yesterday that the creditors are demanding the abolition of the top bracket for the solidarity levy, which concerns taxpayers making at least 500,000 euros per year and sees an 8 percent charge on their income.