IMF’s Lagarde praises progress in Greece, urges reforms

“The Greek authorities have made commendable progress in reducing fiscal and external imbalances and in restoring competitiveness,” Managing Director of the International Monetary Fund (IMF) Christine Lagarde said following a meeting of the IMF’s executive board on Saturday evening which approved the disbursement of the latest tranche of a rescue loan to Greece of 1.74 billion euros.

“The authorities remain committed to make rapid progress on productivity-enhancing structural reforms and on tax and public administration reforms,” Lagarde added.

The IMF chief stressed that Greece was well underway to complete its ambitious fiscal adjustment plan, and that it was on track to meet its 2013 fiscal targets.

However, she set tackling tax evasion as a critical priority “by pressing forward rapidly with reform of the revenue administration to improve operational independence and make the burden of adjustment more equitable.”

As far as tax reduction is concerned, Lagarde said that the Greek government should resist the pressures exerted. She noted that “decisive steps are needed to reform public administration, including through targeted staff reductions, to lower costs, improve efficiency, and increase fairness.”

Addressing the issue of bank recapitalization, which is near completion, the IMF head said “the authorities must reinforce the governance framework and return to the private sector the stakes in banks that are under the government’s control at an early time.”

Lagarde concluded by saying that additional measures to reduce Greek debt – which “is projected to remain high well into the next decade” – to levels below 110 pct by 2022, would be welcome by the IMF, provided that the country fully implements all programme conditions. She said it was essential for Greece’s European partners to continue their commitment “to provide adequate financial support to Greece during the life of the program and beyond until it has regained market assess, provided that Greece complies fully with the program.”

Source: Athens News Agency