Referring to Greece in an interview with seven major European newspapers, including Italy’s “La Repubblica”, International Monetary Fund (IMF) Managing Director Christine Lagarde expressed concern over the Greek economy’s medium-term prospects but also the fact that low and middle incomes had borne the brunt of the crisis. The interview was given last Tuesday and published in ‘La Repubblica’ on Saturday.
Lagarde said that much work remained to be done to improve the economy’s prospects and that this required a high level of cooperation, adding that there was a “rich spirit of cooperation” on the part of the IMF.
She disagreed with a statement made by Brazil’s IMF representative Paolo Nogueira Batista that IMF rules had been “broken” in Greece’s case, describing them as “inaccurate” and “clearly biased”. Among others, she noted that the IMF had carried out a study on the fiscal adjustment demanded of various countries and discovered that the effort required of the Europeans was significantly larger, in terms of volume and content, than that required of countries in the Middle East.
Noting the high cost demanded of the poor and middle classes, she said an effort was being made to change this and a system set up to transfer the cost of bank bailouts from the general public to the shareholders of the financial institutions that found themselves in difficulties.