“Their [Greeks] pension scheme is going right into the wall the way it is now, and they know it,” said International Monetary Fund Managing Director Christine Lagarde.
In an interview during the 2016 Women in the World Summit in New York City on Thursday, the IMF chief spoke, inter alia, about the Greek economic crisis and the ongoing bailout negotiations between Greece and its creditors.
Lagarde reiterated the fund’s position that Greece needs structural reforms and, at the same time, its European creditors must offer some debt relief.
“The country needs to reform and its debt is too heavy. These two need to be addressed,” Lagarde said. “Their pension system is going right into the wall the way it is now, and they know it. They need to look at the broader picture on taxation. They need to go after tax evasion, big way.”
“The burden of their debt needs to be reduced,” the IMF managing director continued. “By extension of maturities or by reducing the interest rates.”
Greece needs “real reforms”
In another interview on Euronews that was published on Thursday, Lagarde said that little progress has been made on reforms in Greece.
“Work has been done, progress has been made, but there is a lot more work that needs to be continued and sustained, so that we are not in the realm of quick fix to pretend, but real reforms that will sustain and will support the Greek population in the long term,” the IMF chief said.
When asked what would the IMF do if the reforms do not take place, Lagarde replied: “We certainly hope that they will take place. But it needs to add up and there will be trade offs – trade offs between reforms on the one hand and debt operation on the other hand.”
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