IMF to not bend rules over Greece debt issue

Washington, July 9 (IANS) The International Monetary Fund (IMF) Managing Director Christine Lagarde said that the fund will not bend rules on debts owed by Greece but would remain fully engaged in order to help find solution.

“Whenever the IMF (is) involved, it’s certainly my view that the IMF has to follow its rules, should not bend the rules, and should always be even-handed, there cannot be any special treatment,” Lagarde spoke at the Brookings Institute on Wednesday.

“Our loans to countries experiencing difficulties, our loans are conditional upon various requirements, but all of them aim at restoring stability, restoring growth and debt sustainability,” she said, Xinhua reported.

Lagarde reiterated that Greece should walk on two legs in terms of reform: one is significant reforms and fiscal consolidation, and the other is debt restructuring with sustainability.

She underlined that the situation of accrued crisis needs to be addressed “seriously and promptly”, and the IMF would be engaged to find the most inclusive solution to help restore stability, growth and debt sustainability in Greece.

Since July 1, Greece has been in arrears to the IMF and needs to repay 3.5 billion Euros in loan installments to the European Central Bank by July 20.

Without emergency assistance, Greece seems to head to default, largely increasing the risk of exit from the Eurozone.

Last week the IMF said in a staff report that financing needs for Greece could add up to more than 50 billion Euros (about $55.42 billion) over the next three years and the country is unlikely to close its financing gaps from the markets on terms consistent with debt sustainability.

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