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IMF Weekly Briefing

Release Date: 25 May 2017
The IMF sees differences narrowing and optimism by all sides that an agreement on a program for Greece may soon be reached Gerry Rice told reporters Thursday (May 25) in Washington.

“I would characterize it is that I think actually differences are narrowing and I think that everyone is optimistic that an agreement can be reached and hopefully can be reached at the next Euro group meeting in a few weeks' time.”

But Rice also made it clear that there is no formal agreement yet, and that the status of discussions remains as summarized at the end of the Eurogroup meeting on Monday, specifically that Greece has legislated a strong package of reforms, but the IMF needs to see more specifics on debt relief.

“These were very useful discussions on Monday, and those discussions continue, but essentially the IMF position is as has been stated here, and otherwise many times, that we need to see the two legs of the approach, that is the strong package of reforms, which we have now, but we also need to see debt sustainability, and before we would be able to propose IMF financial participation in a program, we would need to see both of those legs, and again that position has not changed,” Rice said.

The IMF has maintained a policy of needing to see progress on “two legs” in Greece: First, comprehensive fiscal spending legislation by the government in Athens, and secondly a specific and credible plan for how Greece and its creditors can lower the debt burden.

Rice also addressed reports that Ghana is seeking better terms in negotiations to extend its program with the IMF.

 “A key priority is to bring the public sector debt on a clearly declining path.  So we welcome this ongoing dialogue with the authorities and look forward to completing the discussions over the coming weeks,” Rice told reporters, adding that any request to extend would need to come formally from Ghanaian authorities.

“We have made progress in our discussions which are under the fourth review of our program to support Ghana and these discussions have helped us better understand the governments new policies.  We are still working toward a common understanding of their implications and how they align with the program objectives,” Rice said. 

And Rice also addressed the implications of a brewing political uncertainty in Brazil as calls for president Michel Temer to step down have heated up.

“Brazil has built buffers over time and has proven instruments to deal with market volatility and to preserve financial stability.  But again, too soon to assess the implications of the political developments,” Rice said.
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