The IMF has said that it will meet with Greek officials later this week to get the country’s economic program “back on track.”
This statement comes in the wake of yesterday’s bombshell Der Spiegel article alleging that the IMF will not dole out any more aid to Greece.
The IMF is one of the so-called “troika” of lenders that is providing funding to keep Greece afloat, along with the European Central Bank and EU countries. It is an international aid organisation created for the purpose of stabilizing global markets, particularly in relation to stresses generated by developing economies.
Here’s the entire statement, which was released just moments ago:
The IMF is supporting Greece in overcoming its economic difficulties. An IMF mission will start discussions with the country’s authorities on July 24 on how to bring Greece’s economic program, which is supported by IMF financial assistance, back on track.
That’s a somewhat cryptic response from the international organisation, as it does not directly refute reports that the IMF will halt aid payouts.
At the same time, the statement makes clear that the Fund has not yet given up on Greece.
A halt to IMF aid payments would suggest that world leaders see Greece’s situation as hopeless. It would signal tacit approval for a Greek default and likely euro exit, as Greece will not be able to meet its financial commitments to its public creditors if it does not continue to receive aid.
That said, an immediate end to IMF lending seems unlikely. Despite the inefficacy of Greek leadership to adequately impose economic reforms, EU leaders have much to lose from a Greek exit.
It’s highly likely that new negotiations will lead to more talks and more promises of austerity, in exchange for another few months of aid money. More than anything, such reforms might reignite public protests and unsettle the Greek government.
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