IMF: The humanitarian crisis must be taken into consideration

The IMF is trying to broker a compromise between Athens and Europe that would have Greece ratchet down pension spending in return for substantial debt relief from European creditors.

Concerned that any relaxation of the targets agreed to last year by Greece and Europe would perpetuate the country’s crisis, IMF officials said they won’t rubber stamp a program that doesn’t credibly meet the debt and fiscal goals outlined earlier.

“It has to add up,” IMF spokesman Gerry Rice told reporters Thursday, echoing comments by Poul Thomsen, the man primarily responsible for the Greek program at the fund. “We have been the ones seeking realism.”

Greece and its lenders have been locked in a rancorous battle, freezing much-need emergency lending. Europe wants the IMF to be involved to ensure the bailout program is viewed as credible. Overly optimistic assumptions, including growth prospects for the nation, would simply resurrect destabilizing fears of a Greek exit from the eurozone, fund officials say.

The IMF has been adamant that Europe give Greece debt relief, extending the maturities on the country’s bonds at the very least, and that Athens cut pension spending by several percentage points of gross domestic product.