IMF Lagarde – “way premature to discuss extension”

In an interview with CNBC, IMF Managing Director Christine Lagarde stated on Greek new coalition government that “I’m quite pleased to see that the Greek authorities are aware of the fact that they have to demonstrate their determination to own, adopt and implement the program. Because I think that’s a quid pro quo that was not necessarily in place previously. That change of attitude I think was warranted, is welcome, and will help have a better dialogue with the authorities”.

Asked on potential extension of Greece’s adjustment program she stressed that “it is way premature to discuss extension, to discuss additional financing” adding that “first of all it’s a new mindset, a proper fact-finding exercise, and then a discussion with the authorities to see how with their new policies, their new strategy, the situation can be accommodated”.

On Greek people sacrifices, she noted that “I think we need to recognise that the Greek population has suffered a lot, and have made sacrifices of significant nature and amount” adding that “Greek people have made huge efforts which often go under-estimated”.

A few days earlier IMF spokesman appeared more open to ideas and a bit less pessimistic. Ms Lagarde, since you are aware of Greek people sacrifices, you should also know that Greeks are emotional people. Have you ever though that giving them a grain of hope would slightly ease domestic reaction and support upcoming crucial decisions? Or you think strict directives are always the right approach?

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