Greece pledges to repay IMF debt this week

IMF chief Lagarde says about $500m to be sent by April 9, despite speculation Athens may not make payment.

Yanis Varoufakis
Greek Finance Minister Yanis Varoufakis told the IMF chief that the payment would be forthcoming [Getty Images]

Greece has confirmed it will make a 460 million euro ($505m) debt payment to the International Monetary Fund (IMF) this week as it seeks to allay concerns over the country’s solvency.

IMF chief Christine Lagarde said late on Sunday that Greek Finance Minister Yanis Varoufakis had pledged to make the payment on time in a meeting in Washington.

“Minister Varoufakis and I exchanged views on current developments and we both agreed that effective cooperation is in everyone’s interest,” Lagarde said in a statement.

“We noted that continuing uncertainty is not in Greece’s interest and I welcomed confirmation by the minister that payment owing to the Fund would be forthcoming on April 9.”

Announced barely a day in advance, Varoufakis’ meeting with Lagarde had added to speculation that Greece and its new hard-left government was finding it increasingly difficult to raise money to pay its debts.

A Greek government source on Monday acknowledged that “the crucial phase in which relations between Greece and its creditors find themselves” made such a meeting necessary, the AFP news agency reported. However, the source reportedly downplayed more serious concerns.

“An initial high-level meeting between the new government’s finance minister and the IMF director was expected,” the source reportedly said.

Athends demands more loans

There was speculation ahead of the visit that Athens might fail to meet the instalment if forced to choose between paying the IMF and paying government workers.

Athens though wants the IMF, the European Commission and the European Central Bank to recast their massive financial aid to the country as it tries to turn its economy around.

Last month, Greek Prime Minister Alexis Tsipras had warned German Chancellor Angela Merkel in a letter that Athens would not be able to service its debt without more financial help from the EU.

Varoufakis’ ministry however reiterated after his meeting with Lagarde that the Greek government intended to meet all its financial obligations.

“There is a game of poker going on between German and Greek governments,” Stephen Haseler, the director of the Global Policy Institute, told Al Jazeera.

“Greece says if they don’t get loans from you, they will default, but don’t want to carry out social welfare and wages cuts Germany still demands. None of the sides backs down.”

Source: Al Jazeera, News Agencies