Home »Stocks and Bonds » Pakistan » IMF suspends aid talks with Greece

The International Monetary Fund said Monday it was suspending talks on a new disbursement of financial aid to Greece until a new government is formed after elections slated for late January. "Discussions with the Greek authorities on the completion of the sixth review of the program... will resume once a new government is in place, in consultation with the European Commission and the European Central Bank," IMF spokesman Gerry Rice said.

Rice, however, assured that the hold-up in the program would not impact the country's finances in the short term. "Greece faces no immediate financing needs," he said.

The sixth review of the IMF's four-year, $35 billion loan program for Greece, part of a joint IMF-EC-ECB rescue worth nearly $300 billion, aims at ensuring the government is meeting particular budget and reform targets before releasing a new tranche of the loan. Earlier Monday, Greek lawmakers failed in a third attempt to elect a new president, and Prime Minister Antonio Samaras proposed to hold a parliamentary election on January 25.

That sparked concerns the far-left Syriza party could capture a dominant position in the legislature and roll back tough austerity measures required under the IMF program.

The elections have placed into question how Athens will proceed in a new phase of the massive 2012 rescue, as the country hopes to return to growth next year.

Athens had been weighing converting its IMF loan to a precautionary program, in hopes that it could finance its needs in debt markets under less rigorous conditions.

The country had also been weighing opening a new credit line with official European lenders.

The European Central Bank said Monday it would seek views from Greek authorities on how to proceed with a review of the country's bailout after lawmakers failed to elect a new president, triggering the snap election.

"It's now for the Greek electorate to decide about the future composition of the parliament and the government. We will not interfere in or comment on this democratic process," the ECB said in a statement.

Copyright Agence France-Presse, 2014


the author

Top
Close
Close