Greece needs debt relief to recover its economy after agreeing to several austerity measures in exchange for a bailout, said International Monetary Fund (IMF) Deputy Managing Director Zhu Min.
“The financing is clearly a very important issue for the Greek economy and the debt relief is also an important issue,” Zhu said, according to a Bloomberg report. “Given the debt ratio is way high, something we need to think of is a proper way to do the debt relief profile and debt restructuring to reduce the burdens and help the economy move forward.”
Greek Prime Minister Alexis Tsipras agreed to a three-year bailout plan worth 84-86 billion euros that will keep the debt-stricken country in the Eurozone. The European Commission also agreed to reevaluate the Greek debt and offer some relief on the condition that Greece successfully completes reforms.
Greece missed another payment to the IMF on Monday, increasing arrears to its creditor to approximately 2 billion euros. Athens requested a loan repayment extension, which will be discussed at an IMF board meeting, Zhu said.
“Since they have arrears, of course we are not allowed to disburse the funds further,” he said. Once the arrears are cleared “we will be able to disburse the remaining funds in the program we negotiated three years ago,” he said, according to Bloomberg.
See the text of the IMF analysis below:
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