Greek finance minister meets with IMF head

Headquarters of International Monetary Fund

Greek Finance Minister Yanis Varoufakis was to meet Christine Lagarde, head of the International Monetary Fund(IMF), on Sunday, March 9, in Washington. The meeting was to discuss the planned reforms Greece sent earlier to creditors including the IMF. Greece has been hoping that the reforms would be accepted quickly and funds released to pay upcoming debt of roughly $490 million to the IMF due on April 9. The IMF said the talks would constitute an "informal discussion". Varoufakis is expected to meet US Treasury officials the next day.

Some reports suggest that Greece might not make the payment to the IMF when it comes due if this will not leave sufficient funds for upcoming payment of pensions and government salaries.

There are also suggestions that Greece could nationalize the banks and exit the euro zone by introducing the Greek drachma again. 

The Greek Interior Minister actually suggested that Greece would prioritize payment of wages and pensions over meeting the debt payment to the IMF. As has happened several times lately, the government contradicted the statement and said that this was not its position.

Euro zone officials quoted the Greek government as saying it would run out of funds by April 9. The German Magazine Der Spiegel also quoted Nikos Theocharachis as maintaining that Greece would probably not pay the IMF debt on April 9.

Immediately, the Greek Finance Ministry denied Theocharakis' claim.

The Deputy Finance Minister, Dmitris Mardas said on Greek TV: "We strive to be able to pay our obligations on time, We are ready to pay on April 9." Mardas also insisted that Theocharakis had not said that the technical teams sent to Athens to examine the government books were "completely useless".

According to Mardas: "Mr. Theocharakis never characterized the technical teams of the institutions with the phrase attributed to him. On the contrary ... he referred to them as saying they include 'top-notch people with impressive skills.'" Government spokesperson, Gabriel Sakellardis, also gave reassurance that Greece would pay the IMF debt due on time, saying there is "no chance that Greece will not meet its obligations to the IMF".

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Belgian Finance Minister Johan Van Overtveldt said that Greece would not be allowed to postpone the payment to the IMF and that no further funds would be released until some of the promised reforms were actually implemented. Greece has not received any bailout funds since August of 2014.

Greece has not been allowed to use its sovereign debt to participate in the liquidity program that enables other euro zone countries to obtain funds. Greece has had to issue more treasury bills and even borrow from state entities to meet payment demands. After the first proposals for reform were rejected, new proposals are being studied.

While EU officials say that there has been progress in talks, they also claim that more work is required before a deal can be finalized.


Greece hopes to have a meeting of euro zone deputy finance ministers on the afternoon of April 8 and even on the morning of April 9.

However, the next meeting of the euro zone finance ministers will not be until April 24.

Sources:
http://www.reuters.com/article/2015/04/04/us-eurozone-greece-imf-idUSKBN0MV0EE20150404
http://www.afr.com/news/world/europe/greece-set-for-imf-meeting-amid-speculation-of-payment-shortfall-20150404-1mepzs
http://www.bloomberg.com/news/articles/2015-04-04/greece-has-cash-to-make-imf-payment-next-week-minister-says
http://www.arabnews.com/news/727961