According to Angela Merkel, the German chancellor, and Christine Lagarde, the International Monetary Fund’s (IMF) Managing Director, there has been progress in the negotiations between Greek and the international lenders. Both women expressed their determination to “continue to help” but as Lagarde put it “we are clearly not where we want to be”
During a common press conference with Christine Lagarde, chancellor Angela Merkel said Germany wanted a quick conclusion of a bailout review. She added however that a debt haircut for Greece is not possible.
“It is not a demand of the federal government to have no debt haircut but rather in our opinion this is legally not possible in the euro zone” said Merkel Lagarde and other global economic leaders in Berlin. There are nevertheless other tools that could be used to tackle the debt issue, which has to be dealt with, she added. Merkel says she want the IMF on board with the Greek program.
On the other hand, Lagarde said “long-term sustainability, and debt sustainability for Greece is going to matter for private sector investors”.
“We are clearly not where we want to be and particularly where Greece should be in order to be stable, in order to be prosperous, in order to respond to the Greek population needs” she added.
On behalf of the IMF Lagarde said “We are engaged, we are working together, we had a really good discussion earlier on today with the chancellor, and we are determined to continue to help” on Greece.
Last Saturday a leak by Wikileaks suggested IMF officials were apparently mooting scare tactics to get a different deal on Greece. Lagarde denied that IMF would push Greece closer to default to change the negotiation table.