WASHINGTON May 6 Greece has made progress in
reducing government debt and improving its competitiveness, but
needs to follow through on structural reforms to ensure its
economy recovers, the IMF said on Monday after a mission visit
to the country.
The International Monetary Fund, one of the indebted euro
zone country's international lenders, said Greece must do more
to fight its 'notorious' tax evasion and open up labor
competition to ensure the burden of austerity does not fall
disproportionately on wage-earners and pensioners.
"Decisive corrective actions are needed in each of these
areas to promote an early supply response and achieve a more
balanced distribution of the burden of adjustment," the IMF said
after its visit. "The mission welcomes that the government is
refocusing its program in recognition of these problems."
Measures to cut Greece's budget deficit and make its economy
more competitive are key conditions of its 240 billion euro
($314 billion) bailout from the European Union and the IMF.
The IMF said Greece has made "exceptional" progress on
reducing its fiscal deficit since 2010, with its primary budget
surplus, or the surplus before taking into account debt
financing costs, set to improve by 10 percent by the end of the
But the country's public debt remains "much too high," the
Washington-based lender said.
"It is, therefore, very welcome that Greece's European
partners have now accepted that Greece could need significant
exceptional support on below-market terms in order to restore
debt sustainability and that they have committed to provide
additional relief, if needed," the IMF said, in order to ensure
Greece's debt falls below 110 percent of GDP by 2022.
"Such a commitment is essential to assure creditors that a
credible framework for dealing with Greece's debt overhang is
now in place."