IMF: Greece’s Debt Is to a Large Extent Unsustainable

Originally appeared at DWN, translated by Karin exclusively for SouthFront

The IMF considers the Greek debt to a great extent unbearable. The IMF calls for harsh cuts in pensions and the EU to waive parts of their demands. Germany still refuses the by all experts seen, inevitable cut.

The International Monetary Fund (IMF) classifies Greece’s debt as “intolerably high”.

In addition to the reforms the IMF is calling in a draft for the European partners to waive the country’s debt to a substantial extent, Reuters is reporting. The IMF, the European Central Bank and the European Commission created it as a part of the ongoing development of the Greek development. German Federal Finance Minister Wolfgang Schäuble has already declared to see currently no need for debt relief.

Greece continues to struggle with high unemployment, which rose most recently in January to 24.4 percent. To bring the country economically back on its feet the IMF recommends changes in the tax system and the implementation of the pension reform. According to this among other things, the support for poor pensioners should expire; pensions newly calculated and new public pension payments of 345 euros monthly will be introduced after 15 years of contributions.

The Greek government plans to present next week its legislative proposals for a pension and tax reform to Parliament. Their evaluation is considered crucial to get a positive assessment from IMF, EZB and European Commission of the progress of reforms. Of which again depends on whether the country will receive more money from the credit facilities comprising 86 billion euros. Schäuble holds an agreement for feasible by the end of April. Athens has to pay back in July 3.5 billion euros to the IMF and the EU and has also to settle unpaid bills.

The IMF assumes in the draft that the Greek economy can grow over a long-term annual rate of 1.25 percent. This is less than most recently assumed and “ambitious, but realistic” according to the IMF.