IMF board abolishes exemption for funding countries such as Greece

21 January 2016
846 Views

The governing board of the International Monetary Fund has decided to abolish an exemption that permitted the funding of member-states even if they did not meet the necessary terms, provided that they are systemically critical. The abolition came at the recommendation of IMF head Christine Lagarde.

This exemption is what allowed the IMF to participate in the first and second Greek bailout programs, despite the country’s public debt having repeatedly been declared non-sustainable. The decision was take in order to restrict the Fund’s exposure to risk and is part of Mrs. Lagarde’s campaign to secure her reelection at the IMF’s helm.

With the Greek public debt currently unsustainable, the IMF has essentially decided to not provide any funding in the third bailout program and will limit itself to providing technical advice. This development is expected prompt reactions from Athens, Brussels, Berlin and Frankfurt, since European officials have underlined the importance of the IMF’s participation in the Greek program.

Greek Prime Minister Alexis Tsipras is scheduled to meet with Mrs. Lagarde on the sidelines of the annual World Economic Forum in Davos and is expected to discuss the issue, along with pledging the Greek government’s support in her candidacy.

You may be interested

Mystery titanium ball found in Bahamas from space
WORLD
shares13 views
WORLD
shares13 views

Mystery titanium ball found in Bahamas from space

Panos - Mar 01, 2021

A heavy titanium ball, believed to have been a part of a Russian spacecraft, has been discovered on a beach…

Greek government spokesperson resigns
GREECE
shares17 views
GREECE
shares17 views

Greek government spokesperson resigns

Panos - Mar 01, 2021

The Greek government spokesperson, Christos Tarantilis submitted his resignation in a letter to the Prime Minister, Kyriakos Mitsotakis on Sunday.…

Video shows Turkish President Erdogan supported as he walks down stairs
GREECE
shares19 views
GREECE
shares19 views

Video shows Turkish President Erdogan supported as he walks down stairs

Panos - Mar 01, 2021

A video showing Turkish President Erdogan Turkey being supported as he tries to walk down a flight of steps with…

Leave a Comment

Your email address will not be published.