IMF memo in Reuters hands reveals Greek debt ‘highly unsustainable’

Fund calls on Greece’s EU partners to cut debt

According to a draft IMF memo in the possession of news agency Reuters, the Greek debt is dubbed as ‘highly unsustainable’. The report calls on the EU to offer Greece a ‘generous’ debt relief, underlining that restoring debt sustainability requires Greece’s European partners to give the country a large debt write off, besides the reform efforts. The memo projects that Greece will record a primary GDP deficit of 0.5 percent in 2016, a primary surplus of 0.25 percent in 2017 and 1.5 percent in 2018. The document highlights the after 5 years of harsh reforms has resulted in social pressures in Greece. The Fund estimates that the Greek economy will achieve a 1.25 percentage growth rate in the long term, adding that if the goals set by the IMF, which is considers as realistic, are adopted Greece could reach a primary GDP surplus of 2.5 by 2018.