Parliament Closing Heads Off Critical IMF Report

A sudden and unexplained shut down of the Greek Parliament for two weeks on June 4 was for “procedural reasons,” the government said officially, but it came just a day ahead of what’s expected to be a critical report on the country’s finances, preventing any debate. It wasn’t said who ordered it. Poul Thomsen, an envoy from the International Monetary Fund, one of Greece’s Troika of international lenders along with the European Union and European Central Bank, was due to present his report June 5 at 7 p.m. but that was pushed back at least a day. The Troika has been monitoring Greece’s books while the country is in the last stages of receiving 240 billion euros ($327 billion) in two bailouts. Prime Minister Antonis Samaras has insisted Greece is on the road to recovery, citing a 1.5 billion euro primary surplus and floating of a 3-billion euro bond this spring, the first in four years. IMF spokesman Jerry Rice is expected to discuss the report at the agency’s next news conference. The newspaper To Vima said it will be critical of the country’s financial situation, including what could be a shortfall of 1.8-2 billion euros and a 2015-16 fiscal gap of more than 13 billion euros. The report is also thought to discuss the sustainability of Greece’s 315.9 billion euros ($430 billion) with the IMF previously stating it would still be as much as 122 percent of Gross Domestic Product, from 175 percent now. More alarming to Greece, it allegedly also raises the question of whether to impose the same kind of harsh measures in Greece the IMF did as part of a bailout given Cyprus, which called for confiscation of nearly half the amount of bank accounts of more than 100,000 euros ($136,128). Additionally, the report likely answers the question whether the IMF is still against the Greek government using the 12 billion euros left over from the bank recapitalization to cover its funding gap without having to take out a new loan. Finally, the report will reportedly clarify to what extent the IMF will insist upon strict changes in employment relations. It was said that the IMF favors the deregulation of collective redundancies and revising the minimum wage in 2016.

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