Greece pays IMF €750m day earlier

GREECE paid about € 750 million (R10 billion) to the International Monetary Fund (IMF) yesterday, a day before it was due, two Greek finance ministry officials said. The payment averted the prospect of default that had shaken financial markets. “The order to pay the IMF has been executed,” a senior Greek finance ministry official said. Athens was close to running out of cash and there had been doubt about whether it would pay the IMF.

GREECE demanded yesterday that euro zone finance ministers acknowledge progress in fraught negotiations on a cash-for-reform deal, hoping to unlock short-term borrowing to ease its acute financing crunch.

However, sources familiar with European Central Bank (ECB) thinking said there was still too little advance on key issues and too much uncertainty for the bank to allow the Greek government to sell more shortterm Treasury bills.

Greece made a crucial € 750 million (R10 billion) debt repayment to the International Monetary Fund (IMF) yesterday, a day before it was due, two Greek finance ministry officials said.

The payment averted the prospect of default that had shaken financial markets.

Athens is close to running out of cash and there had been doubt about whether it would pay the IMF or choose to save cash to pay salaries and pensions later this month. Greece’s government in recent days had insisted it would honour its obligations, but officials in the past have warned the country may not have enough money to make the payment.

Precarious

Despite the payment, Greece’s financial condition remains precarious unless it secures fresh aid from lenders.

Euro zone officials, however, played down the prospect of the ECB raising the limit on short-term treasury bills that Greek banks can buy, a move that would help avert a Greek national bankruptcy.

But government spokesman Gabriel Sakellaridis said Athens was not linking the IMF payment to the outcome of yesterday’s Eurogroup meeting or considering any “plan B”.

“What it wants from Eurogroup is to have on record that considerable progress has been made in the talks.”

But Italian Economy Minister Pier Carlo Padoan said he did not believe ministers would make such a joint statement, although Eurogroup chairman Jeroen Dijsselbloem was going to hold his usual news conference after the meeting.

A senior EU official said negotiations had crept forward only slowly in the last week and there was no breakthrough on the central sticking points of pension and labour market reforms and budget targets for this year and next.

Slovakian Finance Minister Peter Kazimir summed up many ministers’ frustration when he said in a tweet there had been improvements in the process but still no progress in substance, with wide gaps between what Greece says in Brussels and what it does in Athens.