(Greece) – The International Monetary Fund, or IMF, is taking a tough stance concerning the looming Greek debt, which has put them at odds with some of the international creditors, particularly Germany and other creditors that are part of the Eurozone. All parties involved, including Greece, the international creditors, and the IMF, had hoped to wrap up bailout talks by the end of the May. It is unclear at this time whether this current development will cause a delay in negotiations.
The subject of austerity has been under debate since the first bailout talks in 2010 and has been under debate ever since. The Greek parliament will vote on the newest wave of austerity measures over the weekend. The IMF believes that if Greece isn’t able to manage their debt burden in a sustainable way, the country will never enter into a period of new growth. Germany, on the other hand, believes that Greece needs to stick with its austerity promises or else they will set a bad example for future bailout reviews, if needed, and for other countries that may need debt relief in the future.
The International Monetary Fund has gotten tougher about their stance before the Eurozone finance ministers meet next week, after Greece votes on whether or not they will accept the new austerity demands. The IMF’s demands are more specific and cover issues such as how much the debt payments will cost and when the debt payments will be made. The IMF started to become concerned about Greece’s debt load last summer in 2015. They maintain that their debt of nearly 300 billion Euros is too much to manage and will hold the country back economically.
These demands have impacted Germany the most because they go against the country’s position. If the German government gives too much for the Greek bailout, the German taxpayers will be expected to shoulder some of the burden. If they give too little, Germany may not receive support from the IMF for the bailout, which many lawmakers in Germany have named as a condition for their support for the bailout. Many believe that in order for the newest round of bailout talks to be successful, Germany and the IMF need to both find a way to resolve these differences.