Brussels, 30/07/2015 (Agence Europe) - The International Monetary Fund (IMF) will participate in talks on a third bailout plan to ensure that it is “consistent with what it has in mind”, but “cannot reach staff level agreement at this stage” to come on board, the Financial Times (FT) reported on Thursday 30 July.
According to the newspaper, which has had sight of a summary of the meeting of the IMF board on Wednesday 29 July, Greece does not fulfil two criteria to qualify for an IMF financial assistance plan: medium-term viability of public debt and the “institutional and political capacity” to implement economic reforms.
“Greece wants to decide on some important reforms only in the autumn and the Europeans only want to deal with the debt issue after the first review, because they want to rebuild trust”, the summary lists as existing problems. It also highlights the “very large” differences between the IMF's thinking about the debt issue and what the Europeans are currently discussing.
The FT also reports that certain non-European member countries of the IMF, particularly in Asia, but also Brazil and Canada, have warned of the need to protect the IMF's reputation.
IMF involvement in the third bailout plan is crucial to certain eurozone states, in particular Germany, whose national parliament will ultimately be called upon to give its blessing. Germany's representative to the IMF is reported to have told the meeting of the board that Berlin would prefer the Fund to move forward in parallel to the aid plan under the European Stability Mechanism (ESM).
“What will be critical in my view is what the Greek authorities actually are prepared to do”, rather than the “political noise” around actions promised, the IMF Director General, Christine Lagarde, told a press conference on Wednesday 29 July. She stressed that the Greek government must demonstrate “determination” to push the reforms through.
On 23 July, IMF spokesperson Gerry Rice said that the IMF's participation in a third bailout plan will require “on the one hand, reforms, commitment, implementation and, on the other hand, financing”. “We have said pretty clearly we feel the debt relief is required”, he added. (Elodie Lamer)