Contrasting the views of the EU Institutions and the IMF staff on the outlook of Greek economy and the present bailout programme
The study presented herein has been motivated by the ongoing negotiations between the Greek government and the Institutions (EC/ECB/IMF/ESM) in the context of the 2nd review of Greece’s present bailout programme. It attempts to analyze important deviations and similarities in the views presented by the IMF Staff and the EU Institutions as regards the prospects of the Greek economy, the sustainability of public debt, the fiscal consolidation programme as well as and the product and service market reforms that need to be implemented to boost productivity and restore competitiveness within the Currency Union. The analysis leans on the information presented in several official-sector documents including, inter alia, the European Commission’s “Compliance Report, The Third Economic Adjustment Programme for Greece, First Review”(June 2016), the IMF Country Report, No. 16/130 “Preliminary Debt Sustainability Analysis – Updated Estimates and Further Considerations” (May 2016) as well as some of the key views that are understood to be included in the new Staff reports that are expected to be discussed at the IMF’s Executive Board meeting on February 6, 2017. We believe that the analysis provides a useful framework to comprehend the views of the different key stakeholders in the Greek programme and the policies that need to be implemented for restoring economic growth and fiscal sustainability.
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