Sunday 25 September 2016

IMF chief Christine Lagarde voices disappointment over Greece stalemate

Sarah N. Lynch and David Morgan

Published 28/06/2015 | 18:41

International Monetary Fund Managing Director Christine Lagarde arrives at a Eurozone finance ministers emergency meeting in Brussels, Belgium June 24, 2015. Greek Prime Minister Alexis Tsipras wrestled with creditors demanding changes to his proposed tax and reform plans on Wednesday in a last-minute race to clinch a deal to which euro zone finance ministers could agree. REUTERS/Yves Herman
International Monetary Fund Managing Director Christine Lagarde arrives at a Eurozone finance ministers emergency meeting in Brussels, Belgium June 24, 2015. Greek Prime Minister Alexis Tsipras wrestled with creditors demanding changes to his proposed tax and reform plans on Wednesday in a last-minute race to clinch a deal to which euro zone finance ministers could agree. REUTERS/Yves Herman
International Monetary Fund Managing Director Christine Lagarde leaves a Eurozone finance ministers emergency meeting in Brussels, Belgium, June 24, 2015. Greek Prime Minister Alexis Tsipras wrestled with creditors demanding changes to his proposed tax and reform plans on Wednesday in a last-minute race to clinch a deal to which euro zone finance ministers could late agree. REUTERS/Philippe Wojazer
International Monetary Fund Managing Director Christine Lagarde leaves a Eurozone finance ministers emergency meeting in Brussels, Belgium, June 24, 2015. Greek Prime Minister Alexis Tsipras wrestled with creditors demanding changes to his proposed tax and reform plans on Wednesday in a last-minute race to clinch a deal to which euro zone finance ministers could late agree. REUTERS/Philippe Wojazer

The head of the International Monetary Fund has said she is disappointed in the stalemate over talks to prevent Greece from defaulting on its IMF debt, but said the euro area is in a "strong position" to respond effectively to developments.

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In a statement, IMF Managing Director Christine Lagarde endorsed a balanced approach to restore economic stability and growth in Greece, accompanied by structural and fiscal reforms, and remained committed to continuing negotiations.

IMF managing director Christine Lagarde and Finance Minister Michael Noonan and French Finance Minister Michel Sapin at the meeting in Brussels
IMF managing director Christine Lagarde and Finance Minister Michael Noonan and French Finance Minister Michel Sapin at the meeting in Brussels

Lagarde said she shared her "disappointment" over the inconclusive outcome with the IMF executive board and welcomed the readiness of the European Central Bank and Eurogroup to make use of all available tools to preserve the euro zone's stability.

Crisis Mode: Greece to keep banks shut on Monday as people queue to withdraw money  

"These statements underscore that the euro area today is in a strong position to respond to developments in a timely and effective manner, as needed," she said, noting that the Greek government must enact reforms supported by "financing and debt sustainability measures."

Greece have announced it will keep its banks shut on Monday, after creditors refused to extend the country's bailout.

There is an existential crisis at the heart of Europe – flannelling about is not the response expected by the nigh on 500 million who live within its borders
There is an existential crisis at the heart of Europe – flannelling about is not the response expected by the nigh on 500 million who live within its borders

Greece's government had been negotiating a deal to release funding in time for its IMF payment, which is due on Tuesday.

Greece crisis: Eurozone finance ministers refuse Greek request to extend bailout programme  

Then suddenly, in the early hours of Saturday, Prime Minster Alexis Tspiras asked for extra time to enable Greeks to vote in a referendum on the terms of the deal.

The country's creditors turned down the request, leaving Athens in the lurch and in danger of defaulting.

Congressman Ed Royce, the chairman of the U.S. House of Representatives Foreign Affairs Committee, said on Sunday he fears Greece may leave the euro and fuel more instability in the region.

"Greece looks likely at this point to leave the euro and I think the danger of that is there are other left-wing governments in Europe that might follow suit," he said on Sunday Morning Futures with Maria Bartiromo.

EU rejects bailout extension plea  

"That would lead to a very consequential impact for the euro and frankly create more instability in the region. It is a pity that Greece does not get its act together."

Reuters

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