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IMF and EU policymakers take Greece bailout spat online

IMF and EU policymakers take Greece bailout spat online

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War of words breaks out between officials over austerity measures

Tensions between the International Monetary Fund and eurozone policymakers over a Greek bailout erupted into a full online showdown on Thursday, raising questions over whether the IMF will join the latest €86bn rescue.

Here is how the war of words unfolded:

In a blog post on Monday afternoon, senior IMF officials rejected claims that it was seeking to impose more austerity on Greece. It had never sought further austerity measures and still held that position, according to Poul Thomsen, director of the IMF’s European department, and Maurice Obstfeld, the fund’s chief economist.

The IMF officials went on to raise concerns that Greece’s debt was unsustainable and that it was pursuing policies that could stall growth.

The blog post reiterated the IMF’s view that budget surplus targets set for Greece under the terms of last year’s bailout deal are unrealistically tough. But it also said that the country needs further tax and pensions reforms.

The IMF officials went on to raise concerns that Greece’s debt was unsustainable and that it was pursuing policies that could stall growth.

The blog post reiterated the IMF’s view that budget surplus targets set for Greece under the terms of last year’s bailout deal are unrealistically tough. But it also said that the country needs further tax and pensions reforms.

He rounded off by urging all partners to engage constructively to reach an agreement. The issue of IMF participation in the programme remains crucial for Germany and Finland, where parliamentary support for the bailout is fragile. The fund is deemed to lend the bailout economic credibility.

Yanis Varoufakis, the former finance minister of Greece, then took to Twitter to accuse Mr Moscovici of hypocrisy for his criticism of the IMF. He claimed Mr Moscovici supports the 3.5 per cent primary surplus by 2018, a target put forward by Athens’ EU creditors.

Simon O’Connor, Mr Moscovici’s spokesperson, fired back that this was not necessarily the commissioners position, in a retort that mocked the Greek politician for his political fate.

But Mr Varoufakis stood his ground.

Copyright The Financial Times Limited 2016. All rights reserved. You may share using our article tools. Please don't cut articles from FT.com and redistribute by email or post to the web.

https://www.ft.com/content/9dc0b0b4-c2aa-11e6-81c2-f57d90f6741a

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