IMF approves $2.3 billion aid for Greece

WASHINGTON - Reuters

IMF Managing Director Christine Lagarde says urgent steps need to be taken to resolve the problems in the privatization program of Greece. AFP photo

The International Monetary Fund (IMF) on late Monday approved a further $2.3 billion (1.7 billion euros) in funds for Greece’s bailout program after completing the fourth review of the cash-strapped euro zone state.

Greece last week adopted the last piece of legislation its international lenders required to release the next batch of rescue loans, after two months of wrangling over unpopular measures to overhaul the economy. The total funds from the IMF, the European Commission and the European Central Bank comprise 5.8 billion euros.

The IMF also confirmed lenders would modify Greece’s September target for how much money it needs to get from privatizing state firms, after Athens struggled to sell natural gas distributor DEPA in June.

The European Union announced the move earlier on Monday, saying Greece would now need to make only 1.6 billion euros from privatizations, down from 2.6 billion euros. But Athens will now have to recoup that money in 2014 to ensure it stays on course to lower its debt.

“Urgent steps need to be taken to address concerns about the structure and governance of the privatization program and to improve its effectiveness,” IMF Managing Director Christine Lagarde said in an updated statement on late Monday. Greece’s reform record has been patchy ever since its EU/IMF bailout started in mid-2010, leading to frequent delays in the disbursement of rescue funds. Opposition to the bailout has also intensified as Greece goes through its sixth year of recession and unemployment hovers at a record rate of 27 percent.