ECONOMY

Small debt delays IMF decision

A northeastern Attica municipality?s unpaid debt was the cause of a delay in the International Monetary Fund?s verdict on the approval of the fifth tranche of the Greek bailout late on Friday.

The decision regarding the disbursement of the IMF?s share of the 12 billion euros to Athens was not expected before midnight as the issue was relegated to last on the agenda of the board meeting in Washington.

When the 4-million-euro debt of the Ano Liosia Municipality was confirmed Friday morning, the Finance Ministry started a race against time in order to cover it. That time, however, was enough for the IMF to put off its decision until later in the afternoon, local time.

It was widely expected that the Fund would give the nod for the fifth installment, in line with the eurozone decision, although a number of foreign press reports suggested that it was about to break its own rules of lending. They added that the IMF might not publish the details required for the funding of programs.

Meanwhile the participation of the private sector in the second rescue package to Greece will likely be smaller, according to German newspaper Handelsblatt and Reuters.

Handelsblatt argued that the contribution of banks and other private bodies will be at half of what had been planned originally, amounting to 15 billion euros, while the whole package will come to 110 billion and last until the end of 2014. Some 30 billion euros of that will derive from privatizations which Athens will need to make.

Reuters cited the same figures, quoting diplomatic sources.

The foreign ministers of Germany and France expressed satisfaction with the private sector?s apparent willingness to participate.

It was also announced on Friday that US Secretary of State Hillary Clinton will visit Athens on July 17 and 18, in an effort to lend support to Greece?s endeavors to manage its growing debt.

Separately, the German edition of the Financial Times contained a proposal by three professors who said the European Central Bank should buy a high number of Greek bonds and ease up on its requirements from Greece.