IMF on Greece: 3.5 pct Primary Surplus, No Pension Cuts Postponement



The International Monetary Fund (IMF) released its renewed Fiscal Monitor for October.

There, the fund revised Greece’s 2019 growth rate upwards and accepted that it made a mistake regarding the last year’s Greek primary surplus.

The IMF had predicted that Greece would achieve a 3.7 percent primary surplus, while now it acknowledges that the country’s surplus reached 4.2 percent.

In addition to this, the IMF agrees with the official projections of the Greek authorities and says that Greece will be able to retain the country’s primary surplus to 3.5 percent every year starting from 2018 until the end of 2022.

This means, though, that the fund does not see any ‘extra’ surplus that would give the opportunity to the Greek government to implement measures that would benefit some parts of the Greek society.

That is the reason why the IMF insists that the already agreed for January 1 2019 pension cuts are a vital structural reform that would give fiscal room for Greece to implement a better tax and social-care policy.