After lengthy delays, the International Monetary Fund unblocked part of its aid to Greece on Wednesday, offering a brief respite to the recession-mired country grappling with austerity measures.
The amount released — €3.2 billion ($4.3 billion) — might seem a mere footnote to the €172 billion international bailout for Greece last March, the second rescue effort after a 2010 aid program foundered. But the installment carries symbolic weight: it closes a chapter on the Greek debt crisis which had put the IMF and its European partners at odds.
“Following a political crisis that delayed implementation of the economic program, understandings were reached with the government on a fully recalibrated economic program to be supported under the EFF arrangement,” the IMF said .
“Greece’s fiscal effort has been impressive by any measure,” IMF managing director Christine Lagarde said in a statement.
The deep deficit slashing the country has been forced to undertake from the beginning of the program will help get Athens back to the spending levels prior to the crisis, she said. But, she warned, “much more remains to be done to achieve the critical mass of reforms needed to boost productivity and lower prices.”
“Looking ahead, Greece needs to radically overhaul its tax administration to bolster tax collections, fight tax evasion, and shrink the public sector, in particular through targeted redundancies.”