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IMF's Tomsen points the finger at EU and Greek government for "social misery"

Featured IMF's Tomsen points the finger at EU and Greek government for "social misery"

In an interview with Austrian newspaper Der Standard, Paul Tomsen talked about Greece and the harsh austerity that has caused "social misery."

The head of the European IMF office in Europe mentioned, inter alia, the Greek bonds, the tax burdens raised by the Greeks, and the pension cuts agreed with Alexis Tsipras.

"The Greeks need to breathe"

Mr Thomsen notes that extending maturity of Greek debt is enough, but it should be important, "but not for 100 years. What we are asking for is space for the Greeks to breathe in order to complete the reforms they need and recover. "

Indeed he re-assured that the Austrian citizens will get all the loans back. "Greece has done a lot, managed an impressive fiscal adjustment. Now the country needs longer deadlines to repay its debts and a period in which it will benefit from a moratorium on payments.

"Greek governments are responsible for austerity, not the IMF"

Responding to the harsh austerity that has plagued Greece, Paul Thomsen disagreed with the Austrian journalist who wanted him responsible for cuts and "social misery."

The IMF executive tried to disclaim responsibility by pointing out in the direction of the Greek governments: "You know, that's the irony of the thing: for some years we were the ones that demanded a smaller budget adjustment. It is unfair for us to be held accountable. Since the first program of Greece in 2010, many things have changed. The Europeans have agreed with the Greeks on strict, unnecessary and ambitious goals that have led to great cuts. We as the IMF accepted it. After some time, however, when the numbers began to derail more and more from the goals, we indicated that something was distorted. We then said that without additional measures, what you have agreed on can not be achieved. That is why there may be a perception that these are goals we have set. However, this is not the case ".

"Tsipras agreed on pension cuts"

At the same time, as Mr Thomsen notes, the IMF has always been against the increase in taxation.

"We have always argued that the strategy of raising tax burdens will not work unless the tax base is expanded. Tax administrations in Greece have failed dramatically because they have not done anything in this direction. Another concern concerns pensions: in order not to reduce them, the Greek governments have accepted almost every other spending cut. But at the point where major problems have arisen in hospitals and the police say they have no money to change tires on patrol cars! In general, expenditure has been contained in an unsustainable way. That is why we, as the IMF, have been calling for years for reforms both in taxation and in the pension system. And finally, Prime Minister Tsipiras' government has finally agreed. "

According to Mr. Thomsen, there was no alternative to cuts, since the budget of the Greek state could not be financed. However, he recognizes that perhaps they should be smaller.