Greek Prime Minister: IMF Not Constructive in Greek Financial Crisis

Greek Prime Minister Alexis Tsipras has condemned the International Monetary Fund’s (IMF) recent behavior in dealing with the European Nation’s lingering financial woes. Tsipras accused the IMF of inconsistency with regard to whether it wanted to stay with a bailout program, and described its conduct as nonconstructive.

Greek Prime Minister Alexis Tsipras has condemned the International Monetary Fund’s (IMF) recent behavior in dealing with the European Nation’s lingering financial woes. Tsipras accused the IMF of inconsistency with regard to whether it wanted to stay with a bailout program, and described its conduct as nonconstructive.

Tsipras made these comments after the IMF issued a list of conditions it expected Greece to meet if the country wished to receive additional funding. The Greek Prime Minister accused the Washington-based lender of making unrealistic demands on both Greece and its Eurozone partners.

“This is a stance that cannot be called constructive in this process,” said Tsipras in an interview with Greek television. “The Fund must decide if it wants to compromise, if it will stay in the program … If it does not want that compromise, it should say so publicly.”

Of the entities involved with helping to bail out Greek after its financial collapse, the IMF has taken the hardest line. The reforms it expects of Greece include pension reforms that would involve benefit cuts and a massive overhaul of the Greek labor market. The IMF has also called upon other European governments to grant Greece debt relief on an unprecedented scale — a proposal these creditor nations have expressed reluctance to consider. One of the IMF’s debt relief proposals even describes a 30-year debt service holiday described by the IMF as a means of making Greece’s debt repayments sustainable.

Because of its stringent requirements and the Greek and European inability to meet these requirements, the IMF has not made any aid disbursements to Greece since August of 2014. Athens defaulted on a payment under that IMF loan program earlier this year in June, but has since become current once more and paid the arrears on that account. However, that repayment only occurred after receiving a third bailout from Eurozone creditors.

Despite the tongue-lashing from the Greek Prime Minister, the IMF claims that it remains open to assisting the troubled country. According to a story by Reuters, a spokesman for the IMF said last week that it would decide whether to participate in a new, co-financed bailout for Greece. However, the decision would hinge on Greece’s participation in the reforms that the IMF had requested.  In addition, how it performs in its debt repayments.

Tsipras acknowledged that the IMF had been helpful, but questioned whether its continuing participation remained necessary or even helpful. He expressed concern that the IMF had become counterproductive to the bailout process by making demands for reform that Greece’s political system and culture simply could not achieve. He also condemned the IMF’s practice of “going to the [EU] partners demanding solutions and proposals on debt sustainability which they know our partners cannot accept.”