The International Monetary Fund’s decision to keep sending rescue loans to Greece ran into opposition from Brazil’s Executive Director at the institution who said he doesn’t to keep supporting the debt-crushed country that looks to be years away from recovery.
Paulo Nogueira Batista’s comments came as the IMF the same day said that Greece is facing a €10.9 billion ($14.4 billion) gap in its government finances – €4.4bn for 2014 and €6.5bn for 2015. “Recent developments in Greece confirm some of our worst fears,” he said.
“Implementation (of Greece’s reform program) has been unsatisfactory in almost all areas; growth and debt sustainability assumptions continue to be over-optimistic,” it said. Batista pointed to an IMF report which while praising Greece “exceptional” progress in stabilizing its economy also suggested a risk the funds will not be reimbursed.
The Brazilian economist said the statement was “one step short of openly contemplating the possibility of a default or payment delays by Greece on its liabilities to the IMF.” His remarks showed growing worry among emerging countries that the IMF – where the EU and US together have majority voting rights – continues to bail out ailing European countries.
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