Greece Bailout: IMF warns against slippage

WASHINGTON: Greece has “little if any margin” for slippage on reforms under its new bailout programme, according to IMF documentation for its loan to Athens released Friday. The International Monetary Fund, which decided a new 28 billion euro loan for Greece on Thursday said Greece could reach its debt reduction targets if it adhered to the tough austerity measures. But it said there was little room to maneuver if Greece did not follow through. “In general, Greece has little if any margin to absorb adverse shocks or programme slippages,” the IMF said in its documentation for the Greek loan. The IMF warned that if any risks materialised, Greece would need more debt relief from official lenders and, if they were not willing, that would “lead to a sovereign default” and possibly a messy exit from the eurozone. But it said its loan programme, in conjunction with the European Union’s large new support programme, is aimed at reducing these risks.

Published in The Express Tribune, March 18^th, 2012.