/ world today news/ The International Monetary Fund (IMF) was humiliated after Angela Merkel and Nicolas Sarkozy pressured it in recent years, solving the problems of banks in their own countries.
The current situation of Greece is “one of the biggest catastrophes in economic policy since the Second World War”, according to the journalist Ben Chu from the British “Independent”.
“How did we get here? Why did it happen that Greece joined Somalia, Sudan and Zimbabwe and officially received from the IMF the status of “deferred payment”, asks the journalist. According to him, placing Greece in the same row as these “incapacitated countries” is “But make no mistake: it’s also humiliating for the IMF,” the expert claimed.
The Greek bankruptcy is the “culmination of a chain of misjudgments” on the part of the Washington-based fund, with the first mistakes being made as early as 2010, when Brussels called for financial assistance to Greece, the Independent journalist believes. From his point of view, the former head of the IMF, Dominique Strauss-Kahn, should have written off Greece’s public debt, which at the time had already reached 133% of the country’s GDP. But instead he caved to the insistence of European politicians who had spoken out against the restructuring of Greek debt.
According to Ben Chu, “the situation has become scandalous” because of German Chancellor Angela Merkel and former French President Nicolas Sarkozy, who have worried about German and French banks. A significant part of Greece’s debt was owed to them. In restructuring, they would suffer heavy losses.
The IMF should not have agreed to the conditions of Merkel and Sarkozy, the fund demonstrated “incompetence and cowardice”. It will be many decades before the IMF recovers its reputation damaged by its role in the Greek disaster, predicts Ben Chu.
BGNES reminds that as of April 1, 2015, the total debt of Greece, according to its finance ministry, was 312.7 billion euros (and this is not an April Fool’s joke). A significant part of this debt, or 184 billion euros, belongs to the European Financial Stability Fund (EFSF – 131 billion euros), and the rest belongs to several countries of the eurozone – Germany, France, Estonia, Slovakia. Greece also owes 27 billion euros to the European Central Bank (ECB) and 21 billion
London / Great Britain
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