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imf περικοπές

imf περικοπές

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Published by: Olympia Gr on Sep 20, 2012
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09/20/2012

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 International Monetary Fund
and the IMF
Press Release
:
 
E-Mail Notification
Subscribe or  Modify  your subscription
Greece:
Letter of Intent, Memorandum of Economic and FinancialPolicies, and Technical Memorandum of UnderstandingMarch 9, 2012
The following item is a Letter of Intent of the government of Greece, whichdescribes the policies that Greece intends to implement in the context of itsrequest for financial support from the IMF. The document, which is the propertyof Greece, is being made available on the IMF website by agreement with themember as a service to users of theIMF website.
 
 
G
REECE
:
 
L
ETTER OF
I
N
TE
N
T
 
Athens, March 9, 2012Ms. Christine LagardeManaging Director International Monetary FundWashington DCDear Ms. Lagarde:The attached Memorandum of Economic and Financial Policies (MEFP) outlines theeconomic and financial policies that the Greek Government and the Bank of Greece willimplement during 2012
 ‒ 
2015. These policies aim to address Greece’s balance of payments problems, correct Greece’s competitiveness gap, support growth and employment; restore public finances to sustainability; secure financial system stability, and to distribute the costof adjustment in an equitable way, within our commitment to the common currency.In support of our objectives, we have committed to a set of key policies, building on whathas been achieved under the Stand-By Arrangement approved in May 2010. These policies place strong emphasis on restoring growth and ensuring an equitable fiscal adjustment:
 
To restore competitiveness and growth, we will accelerate implementation of far-reaching structural reforms in the labor, product, and service markets. Indeed to givea strong upfront impetus to unit labor cost reductions, and protect employment, wehave already reformed the collective bargaining framework and reduced theminimum wage as a prior action for this program. And to reduce market rigidities, boost productivity, and increase long-term growth potential we are implementingreforms in product and service markets and improvements in the businessenvironment.
 
To bring the fiscal deficit to a sustainable position, we will implement bold structuralspending and revenue reforms. The adjustment will be achieved through permanentexpenditure reductions, and measures to this end have already been implemented as prior actions. These efforts will be supported on the revenue side by a tax reform to broaden the tax base and achieve a fairer distribution of the tax burden, and by taxadministration reforms to stem tax evasion. Indeed to reinvigorate this crucial latter effort, we have already taken actions to strengthen the tax administration.
 
We have adopted a comprehensive banking sector strategy to secure a viable andwell-capitalized private banking sector that supports the economic recovery andsustained growth. The banking system will be restructured and recapitalizedfollowing the upcoming sovereign debt exchange. We have already completed a
 
2capital needs assessment and a plan for a large state-owned bank as prior actions. Insupport of these efforts, and as prior actions, we have strengthened our resolutionand recapitalization framework and financial oversight framework 
 
We remain committed to our ambitious privatization plans. Transferring assets inkey sectors of the economy to more productive uses through privatization andconcessions will encourage private investment and support long-term growth.In support of our ambitious multi-year policy program, we request a 4 year arrangementunder the Extended Fund Facility (EFF) in the amount of SDR 23.7853 billion (2,158.8 percent of quota; €28 billion). We also notify the Fund of our cancellation of the existingSBA effective March 14, 2012. We have sent a parallel request for financial assistance toeuro area member states for a total amount of €144.7 billion over 2012-14. The euro areamember states have given assurances that adequate financing will be available to supportGreece during the period of our policy program and beyond for as long as it takes for Greece to regain market access, provided that we implement and adhere to the program.The government believes that sustained implementation of this program, complemented bydebt restructuring, will put the public debt on a clear downward path. In this context wehave launched a debt exchange with the goal of reaching agreement on a restructuring of our debt. We will successfully complete the debt exchange, as described in the attached MEFP, prior to the meeting of the IMF Executive Board to consider this EFF request.The implementation of our program will be monitored by the Fund through quarterlyreviews, quantitative performance criteria and indicative targets, as well as structural benchmarks as described in the attached MEFP and Technical Memorandum of Understanding (TMU). The EC/ECB will also monitor implementation of the program asdescribed in this MEFP, as well as monitor the detailed and specific economic policycriteria in the Memorandum of Understanding agreed with the European Commission (EC).There will be 16 quarterly reviews under the arrangement. The quarterly reviews will assess progress in implementing the program and reach understandings on any additional measuresthat may be needed to achieve its objectives.We believe that the policies set forth in the attached MEFP are adequate to achieve theobjectives under the program and stand ready to take any measures that may becomeappropriate for this purpose as circumstances change. We will consult with the Fund on theadoption of any such actions and in advance of revisions to the policies contained in thisMEFP, in accordance with the Fund’s policies on such consultations.This letter is being copied to Messrs. Juncker, Rehn and Draghi.

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