Christine Lagarde and Wolfgang Schaeuble are locking horns over Greece. Lagarde, head of the International Monetary Fund (IMF), says that Athens needs more time to meet its fiscal targets and should be given two more years to do so. She also said that debt reduction might be necessary before the next round of bailout financing. Schaeuble, Germany’s finance minister, says no—that governments cannot accept any losses on Greek debt.
Bloomberg reported Thursday that Lagarde, speaking at a press conference in Tokyo before the beginning of the IMF’s annual meeting, said that Greece needed more leeway to meet its targets. She was quoted saying, “It’s sometimes better to have a bit more time. This is what we advocated for Portugal, this is what we advocated for Spain and this is what we are advocating for Greece.”
Comments during the past few weeks by IMF officials seem to indicate that before it releases to Athens its share of bailout funding promised last March, the fund will look for European policymakers to make commitments to help Athens in various ways—even in writing off debt or offering further loans.
The IMF has already said it won’t be lending any additional money to Greece. Still, Lagarde said in the report, “We will spare no time, no effort to actually do as much as we can in order to help Greece.” The purpose of the fund, she added, is “to make sure that Greece is back on its feet, that it can one day return to markets, that it doesn’t have the need for constant support.”