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10 Jun 2014
IMF warns Greece might need more assistance to make debt sustainable
FXStreet (Barcelona) - In the latest review of Greece's bailout program progress the International Monetary Fund said that signs of reform fatigue can be seen among the ruling coalition government and urged Athens to step up efforts to improve its public sector efficiency. Otherwise fiscal targets could be missed and further austerity measures required, the organization warned.
"Adjustment fatigue has set in and the coalition government has a reduced majority of just two seats in the 300-member parliament," the IMF said. "This is making it difficult to move forward boldly and swiftly with needed reforms."
The European Union should be ready to provide more debt relief for Greece if needed, the IMF stressed. According to forecasts Greece faces a funding gap of 12.6 billion euros after May 2015 and is expected to fall short of the 2015 budget surplus target of 2 billion euros or 1% of GDP.
Greek debt to GDP ratio is projected to peak this year at 174% and then slide to 128% in 2020 and then to 117% in 2022.
"Adjustment fatigue has set in and the coalition government has a reduced majority of just two seats in the 300-member parliament," the IMF said. "This is making it difficult to move forward boldly and swiftly with needed reforms."
The European Union should be ready to provide more debt relief for Greece if needed, the IMF stressed. According to forecasts Greece faces a funding gap of 12.6 billion euros after May 2015 and is expected to fall short of the 2015 budget surplus target of 2 billion euros or 1% of GDP.
Greek debt to GDP ratio is projected to peak this year at 174% and then slide to 128% in 2020 and then to 117% in 2022.