IMF Backs Big Greek Debt Relief: No Payments Until 2040

The International Monetary Fund – exempting itself – wants Greece’s European lenders to grant debt relief to the beleaguered country, the Wall Street Journal reported.

The newspaper said the IMF, which, along with the European Union, International Monetary Fund and European Stability Mechanism makes up the Quartet of the EU-IMF-ECB-ESM putting up rescue packages, shouldn’t make loan repayments until 2040 on the 326 billion euros ($369 billion) it owes for three bailouts – except for paying the IMF first.

The IMF reportedly wants Greece excused from making any payments for the next 24 years and then for what it owes to be repaid from 2040-2080.

This would also involve keeping the fixed interest rate at 1.5 percent which the IMF was said to believe would keep Greece’s debt repayments to below 15 percent of Gross Domestic Product (GDP per year, which it believes is sustainable.

Critics have said this kind of plan would just put Greek governments into wild spending modes expecting that it would never have to pay, which would mean the taxpayers in the other 17 Eurozone countries would pick up the bill.