Tags: IMF | Greece | Bailout | Failure

IMF Admits 'Notable Failures' in Greek Bailout

Wednesday, 05 Jun 2013 05:31 PM

The International Monetary Fund acknowledged on Wednesday that it made "notable failures" in the Greek bailout and said the country sank into a much deeper recession than expected after the deal was hammered out three years ago.

The IMF made the unusually frank admission in a report on the Greek crisis over too much government debt, which broadened out to infect other European countries. Greece lost access to the bond markets in 2010 and has received a staggering 200 billion euros ($260 billion) is rescue loans from euro countries and the IMF in two successive bailout programs. But it remains mired in a sixth year of recession, with unemployment at 27 percent.

The report said the IMF and its partners in the bailout — the European Central Bank and the European Commission — had significantly underestimated a key measure of how much austerity measures, such as spending cuts and tax increases, would deepen the recession.

Greece missed three of the four main IMF criteria required for such programs. Particularly, the IMF miscalculated the sustainability of Greek debt levels.

The report said there were notable successes in the bailout as well, including Greece remaining in the eurozone and containment of the spillover effect on the global economy.

"However, there were also notable failures," it said.

It described the first two years of the rescue program as a "holding operation" while the other 16 European Union countries that use the euro currency grappled with the enormity of the unfolding crisis. And the report said rescue lenders had allowed Greek debt to remain too high until private bonds were eventually restructured last year.

Some of the failure was blamed on Greece itself, with the IMF saying it had stalled on structural reforms of its economy.

© Copyright 2017 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

 
1Like our page
2Share
StreetTalk
The International Monetary Fund acknowledged on Wednesday that it made notable failures in the Greek bailout and said the country sank into a much deeper recession than expected after the deal was hammered out three years ago.The IMF made the unusually frank admission in...
IMF,Greece,Bailout,Failure
290
2013-31-05
Wednesday, 05 Jun 2013 05:31 PM
Newsmax Inc.
 

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

NEWSMAX.COM
MONEYNEWS.COM
© Newsmax Media, Inc.
All Rights Reserved