It took the intervention of Bank of Greece Governor Yannis Stournaras to resolve a problem with the payment to the International Monetary Fund due on Tuesday. Fund spokeswoman Angela Gaviria confirmed on Tuesday that the installment totaling about 750 million euros was received, but there was plenty of action behind the scenes before that happened.
Some 650 million euros of that was drawn from an “emergency” account at the IMF. Stournaras is said to have informed Deputy Prime Minister Yiannis Dragasakis and other senior government officials of the existence of that account last Thursday. The government immediately started looking into the option of using those funds given that such a move required the consent of the IMF.
Greece’s outgoing representative at the Fund, Thanos Catsambas, applied to the IMF for the issue to be examined, and, according to sources, Stournaras informed the government on Saturday of the Fund’s consent for the use of that money from the emergency account toward the payment of the 750-million-euro installment.
Finance Ministry officials said that although Prime Minister Alexis Tsipras had been informed about that account on Saturday, up to Sunday evening certain people had been advising him not to use it but to forfeit the IMF payment, insisting that the Fund should not be paid until May salaries and pensions had been covered.
On Monday morning the State General Accounting Office examined other options for drawing cash from state entity reserves, and it was found that if the latter invested their available cash in repos then the salaries and pensions would be paid out by the end of the month. Therefore the government chose to activate the payment through the emergency account and exert pressure on state entities to deposit their reserves in the Bank of Greece’s spacial account.
Notably, the 650 million euros used from the IMF account will have to be put back in place in a short period of time, although it is not precisely clear what this means. Consequently, Greece has only managed to buy time, given the marginal conditions of the state coffers.