The Greek bailout deal won't fix the problem, according to a leaked IMF report

IMF managing director Christine Lagarde. Picture: Getty Images

A leaked internal report by the IMF says the third debt rescue package for Greece doesn’t go far enough and more is needed.

“Greece’s debt can now only be made sustainable through debt relief measures that go far beyond what Europe has been willing to consider so far,” the IMF said in the memo.

The latest deal on Monday requires Greece to make further austerity measures.

According to the Financial Times, the leaked memo sent to the Eurozone member states means International Monetary Fund participation in the bailout may be in doubt.

The IMF says some the 320 billion euro debt will need to be written off if Greece is to ever to return to economic growth.

Germany, which is owed the most by Greece, is against writing off any of Greece’s debt.

Chancellor Angela Merkel says the Eurozone will consider some form of debt relief once the bailout deal is implemented. This might only involve extending the maturity on some loans.

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