Some Euro countries willing to let Greece take IMF money

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Some of the countries in the euro zone, including Finland, are willing to swallow their collective pride and allow Greece to borrow money from the International Monetary Fund.
      A short time ago the countries using the common currency emphasised that the role of the IMF in the economic crisis affecting Greece should be limited to technical advice.
     
“It would be good if the IMF were a part of the package. Finland supports both technical and economic aid (from the IMF)”, said Finnish Minister of Finance Jyrki Katainen (Nat. Coalition Party), who was attending an EU finance ministers’ meeting in Brussels on Tuesday.
      According to sources at the meeting, Germany has also turned around and is willing to allow Greece to borrow from the IMF. Italy and The Netherlands are also agreeable to the proposal.
      No decisions on the matter have been made yet. “The issue sharply divides opinions”, said Katainen during a break on Tuesday.
     
Previously, the leaders of the euro zone countries have indicated that the honour of the countries would not allow Greece to resort to the help of the IMF.
      There have been fears that resorting to the help of the IMF would lead to increasing American influence in the area.
      Sources at the meeting say that Greece announced on Monday that if the euro group does not make a clear commitment of support, Greece will seek the help of the IMF on its own.
     
Katainen says that Finland has not changed its mind on the IMF issue.
      In his view, the IMF would not bring changes to the stability programme for Greece that has already been agreed to. The IMF has reportedly said that the stability programme drawn up by the EU for Greece is “too tight”.
      Katainen noted that European countries are represented in the IMF, and that therefore, the fund is not an external provider of aid. The IMF has recently pumped EUR 100 billion into the IMF in addition to previous contributions.
     
On Monday evening, the euro group considered the technical aspects of helping Greece.
      The leader of the euro group, Luxembourg Prime Minister Jean-Claude Juncker emphasised, however, that Greece has not asked for any help.
      Juncker did not specify how the euro countries might help Greece. Loan guarantees are apparently not in the cards, Juncker said late Monday.
     
The most likely form of assistance from individual euro countries to Greece would involve bilateral, voluntary loans.
      The aim of the EU support to Greece is to secure loans for the embattled country. The Euro countries are not setting interest rate targets for the loan, which means that Greece will not be automatically entitled to the same terms for interest as Germany.
      The leaders of the EU member states will discuss the question of aiding Greece at their summit in Brussels next week. Before that, the euro countries will be seeking to iron out a common policy line toward IMF loans.


Previously in HS International Edition:
  EU economy lagging behind this year (26.2.2010)
  Weaker euro eases plight of Finnish export industry (25.2.2010)
  EU urges Greece to enact more spending cuts (16.2.2010)

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