International Monetary Fund could join Greek bailout in three weeks - Eurogroup head
- Author: Zachary Reyes May 25, 2017,
May 25, 2017, 11:32
Ahead of the federal election in Germany in September, the debt relief option is seen as a vote loser.
The IMF insisted on measures that would reduce the cost of debt repayments for Greece in the medium and long term if it was to take part in the €85-billion bailout programme signed in 2015.
Dijsselbloem said the International Monetary Fund welcomed the progress made by Greece, and was "impressed" by the reforms undertaken by Greece and that it stands ready to go to the board to get involved financially. A bailout should not "fail because of German resistance".
However, Jeroen Dijsselbloem sought to downplay expectations that a debt relief package for the cash-strapped country is imminent.
The row will now not be resolved before June 15 when eurozone finance ministers meet again. Some nations like Germany, which is resisting changes to Greece's debt profile, won't release any new funds until the IMF joins the program.
Under pressure from the International Monetary Fund, eurozone finance ministers will consider major debt relief and fresh aid for Greece on Monday despite the deep reservations of bailout-weary Germany.
Pierre Moscovici said before the eurogroup meeting that a deal is "doable" and that it's time to "open a new phase, a new page" with regard to Greece.
"Greece has met its obligations".
European Union officials warn that the Greek programme will run into logistical problems if a deal is not reached soon, especially given that approval procedures will be needed in some national parliaments to sign off the release of bailout aid.
The meeting was the first for Le Maire, who was named to his post last week by Macron, a pro-EU centrist.
Hopes had been high that the deadlock could be broken after Greek lawmakers last Thursday adopted a new round of austerity measures including pension and tax break cuts.
Referring to Britain's looming exit from the EU, Le Maire stressed France and Germany meant to seize any opportunities for their financial industries. The lack of reform and economic competitiveness is the core issue, and the Greek government needs to spur economic growth and domestic investment. He, like Dijsselbloem, said that "extra measures if required" would come after the bailout program expires next year.
The IMF forecasts for Greece's debt needs "are not in line with those from the European institutions", he added.
"The feeling was. more work was needed to be able to have that kind of clarity that the financial markets understood and the Greek people understood (of) what to expect at the end of the programme period in terms of debt relief", Greek Finance Minister Euclid Tsakalotos said.