IMF: Decision on whether to participate in Greece’s program might be taken in December

The International Monetary Fund (IMF) said the decision on whether to participate in Greece’s adjustment program might be taken in December, its spokesman Gerry Rice said during a regular press conference in Washington on Thursday.

He said any decisions will be based on Greece’s debt sustainability analysis which will be submitted to the fund’s board in December.

“Under certain conditions, it is possible that a decision will be taken in December,” Rice told journalists, noting that IMF officials who are in Athens as part of the second program review are in continuous talks with the government on the Fund’s economic participation.

He added, however, that the IMF’s participation requires that either the primary surplus target is lowered to 1.5 percent of the GDP, or the adoption of an even more ambitious reform program.

Rice also reiterated that the IMF estimates the primary surplus targets set in the ESM program implemented by Greece are not compatible with the measures that have been agreed and IMF’s participation presupposes a program with realistic goals, which will be followed by substantial reforms and significant debt relief.

As an example of reforms envisioned by the IMF, Rice mentioned pension reform, saying that Greece’s current pension system is not sustainable as its annual deficit reaches 11 percent of GDP versus 2.5 percent which the EU average. This, he said, must be dealt with.