IMF supports Greek debt relief

IMF supports Greek debt relief

The International Monetary Fund has played a leading role in supporting the view that Greece should be granted debt relief, IMF spokesman Gerry Rice said early on Thursday, stressing that this was clear from the outset.

Responding to a question at a press conference, Rice said he would rather not expand on the issue of the Greek crisis and the IMF’s role in it, which has re-emerged in recent days following the publication of a report on the IMF’s activity by an independent assessor.

“I do not wish to reopen the story of the crisis in Greece,” the US official said, adding that it had been extensively analyzed by the report of the independent assessor, among others. However, he did stress that the Fund had been a standard-bearer among those asking for the Greek debt to be reduced, and added that this was eventually agreed with extensive effect.

That report, which was made public last Monday, highlighted that the IMF’s approach to the issue of the Greek debt was a mistake on the Fund’s part, especially the delay in the provision of debt relief, as that has undermined the prospects of Greek economic growth and hurt the efficiency of the Private Sector Involvement (PSI) in the 2012 debt haircut.

The report also argued the delay resulted in European banks ridding themselves of a large part of their Greek bonds, which restarted the debate over whether Greece has paid the price for bailing out the European lenders. The report further criticized the fact that Greece was accepted for financing by the IMF by exception, even though the sustainability of the country’s debt could not be certified, which eased the pressure for the immediate arrangement of the debt.

Rice noted on Thursday that the Fund continues to support Greece, even without a bailout program, in the context of the post-program surveillance: “We acknowledge the progress recorded,” he stated, “and this is credited to the government and its people.”

He went on to disagree with the view that the IMF had hidden the picture in Greece and the mistakes it had made in this country, after another document was published on Wednesday related to the IMF’s communication policy.

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