Mind the £11billion gap, imf warns greece

Photo credit: Titana

The country’s failure to speed up its overhaul measures designed to tackle its large deficit may see the gap widen even larger, leaving the country with a hole the size of €11 billion.

The IMF raised its concerns last week as Greece received another €4 billion in aid from the group, the European Commission and the European Central Bank.

The cautions follow a €110 billion bailout in 2010 - which was, in turn, followed by another loan of €172 million in June 2013.

“The Fund also cautioned that investment and growth were unlikely to resume in Greece if investors were not convinced that Greece’s creditors had a credible policy to deal with its debt crisis,” reports The New York Times.

The IMF’s latest report said that the Greek economy could return to growth next year. The likelihood of this happening, though, is low, as unemployment in the country has risen to 27 per cent.

The IMF praised some elements of the Greek austerity programme, noting that is on track to create “a leaner, cost-efficient, competitive and well-capitalized banking sector”. But the message remains that Greece must hurry up if it wants to avoid opening another hole in its already patchy finances.