The New York Times
Greece called on the International Monetary Fund on Saturday to explain whether it was seeking to usher Athens toward bankruptcy ahead of a pivotal referendum in June on Britain’s membership in Europe. Greece’s comments came after I.M.F. officials raised questions in a private discussion published by WikiLeaks about what it would take to get Greece’s creditors to agree to debt relief.
The transcript, which captures what WikiLeaks said was a teleconference conversation in March between Poul Thomsen, the head of the I.M.F.’s European operations, and the I.M.F.’s Greek bailout monitor, underscored a widening rift between the I.M.F. and Greece’s European creditors that could jeopardize Greece’s new 86 billion euro bailout. It also exposed the fraught behind-the-scenes political machinations that have led to a deadlock on how to deal with a country still regarded as Europe’s weakest link.
The I.M.F. declined to comment on the WikiLeaks transcript, but said in a statement that Greece needed to be put “on a path of sustainable growth” supported by reforms and further debt relief. The document touched off a fresh political frenzy inside Prime Minister Alexis Tsipras’s government, which accused the I.M.F. of trying to “politically destabilize Europe.”
Nearly a year after creditors granted Greece the new bailout, after a drawn-out financial tempest that pushed the eurozone to the edge of a breakup, the Greek government is blaming the I.M.F. for delaying a review of the progress Greece has made in carrying out its harsh austerity terms. The review is needed so that Greece can receive financial aid and avoid a possible default on looming debts just as Greece has largely been left to fend for itself in dealing with Europe’s migrant crisis.
Privately, however, the fund has discussed pulling out of the bailout deal unless European creditors agree to reduce Greece’s mountain of debt, without which Greece could be dealt a new economic blow. An I.M.F. exit would put the bailout in jeopardy and raise the risk of a Greek default in July, when Athens must repay a large loan. But the European creditors, especially Germany, have resisted, and are pushing the fund instead to soften the austerity terms it is trying to wrench from Greece.
In the transcript, Mr. Thomsen suggests that only a precipitous event might push the Europeans to give in on debt relief and keep the I.M.F. from leaving the bailout.
“What is going to bring it all to a decision point?” Mr. Thomsen asks, according to the WikiLeaks document. “In the past, there has been only one time when the decision has been made and then that was when they were about to run out of money seriously and to default. And possibly this is what is going to happen again,” he said.
Mr. Thomsen added that the June timing of the British referendum on whether to exit the European Union was crucial, because European leaders would be preoccupied with it for at least a month before then and would not want to return to discussions about the Greek bailout until after the vote. That could pose problems for whether Greece receives financial aid from the bailout in time to meet its July debt repayments.
Mr. Tsipras’s government met in an emergency session on Saturday to discuss the implications. “The Greek government asks the I.M.F. for explanations whether pursuing the creation of bankruptcy conditions in Greece, just before the British referendum, is the fund’s official position,” Olga Gerovasili, a Greek government spokeswoman, said in a statement.
As a condition for it to stick with the bailout, the I.M.F. has pressed Germany hard to agree to Greek debt relief. The I.M.F. has leverage because the German Parliament might not agree to release funds to Greece unless the I.M.F. participates in the program. But Wolfgang Schäuble, Germany’s finance minister, has said he sees “no argument” for acceding to the I.M.F.’s demands.
The I.M.F. has countered that debt relief is needed not only to help the economy, but also because the Greek government is politically constrained in carrying out all the austerity needed to begin improving its tattered finances. Those frustrations boiled over in the private discussions published by WikiLeaks.
“These guys agree on something and then they give it up the next day,” Delia Velculescu, the I.M.F.’s mission chief for Greece, is reported to tell Mr. Thomsen in the transcript. “We have said this time and again, we know that they don’t do what we say,” she added. “It just doesn’t function. For them, everything is subject to change — if the authorities want it.”
Mr. Thomsen said he had expected that the refugee crisis in Greece might have pushed creditors to reach an agreement on debt relief quickly. In less than two months, Greece has become Europe’s de facto holding pen for more than 50,000 migrants since European countries shut their borders, preventing asylum seekers from reaching their preferred destination of Germany. Greece has been scrambling to manage a deteriorating situation, including riots in refugee camps and the beginning of a European Union program requiring the mass deportation of refugees from Greek islands starting on Monday.
“I am surprised that it has not happened, is that, because of the refugee situation, they take a decision, that they want to come to a conclusion,” Mr. Thomsen said of the creditors, according to the transcript.
If a conclusion does not come rapidly, he added, the I.M.F. would use the threat of quitting against the German chancellor, Angela Merkel, who cannot afford for Greece to spiral downward at a time when it is keeping the bulk of new refugees from reaching her country.
“You face a question,” Mr. Thomsen suggests the fund could tell Ms. Merkel. “You have to think about what is more costly: to go ahead without the I.M.F.,” he said, “or to pick the debt relief that we think that Greece needs in order to keep us on board.”
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