International Monetary Fund Managing Director Christine Lagarde declined to predict the outcome of a meeting of euro-area finance ministers on reducing Greece’s debt even as officials from Germany and Italy say an agreement will be reached next week.
“It’s not over until the fat lady sings, as they say,” Lagarde told reporters in Manila when asked if an agreement can be achieved at the Nov. 20 meeting. “I would not say anything else.”
Finance officials from the 17 euro countries are seeking agreement on how to cut Greece’s debt to sustainable levels, a necessary step to disburse the next tranche under a bailout they co-fund with the IMF. A disagreement on the timeline for reaching the debt-reduction targets broke out this week, raising questions on whether the IMF will keep financing Greece.
The IMF’s objective is that Greece can operate on a sustainable basis and regain access to markets as soon as possible, Lagarde told reporters in Manila today. She is cutting short a trip to Southeast Asia to attend the meeting of euro- area finance ministers in Brussels.
Greece was granted an additional two years to reach budget- deficit goals in its bailout program until 2016. European finance ministers will discuss ways of plugging the funding gap resulting from that extension at the gathering.
Italian Finance Minister Vittorio Grilli said yesterday he is confident that the policy makers will reach an agreement on aiding Greece when they meet next week, echoing comments by his German counterpart Wolfgang Schaeuble.
“Right now we are focused on finding together with the suggestions and advice of the IMF, a solution,” Grilli said in an interview with Bloomberg Television in London. “Then we will see.”
Giving Greece more time was the latest compromise in three years of crisis fighting. Creditors led by Germany opted to keep money flowing instead of risking a default that could lead to the nation’s exit from the euro and stir more turmoil.
“It’s a question of working hard, putting our mind to it, making sure that we focus on the same objective, which is that the country, in particular Greece, can operate on a sustainable basis, can recover, get back on its feet and can re-access market as early as possible,” Lagarde said. “That’s what is driving the IMF’s determination.”
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