Financial News: IMF approves 4.1bln euro 4th tranche of bailout loan

The International Monetary Fund (IMF) announced late Monday that it is releasing the fourth tranche, 4.1 billion euros, of its share of the 110 billion euro EU/IMF support loan to Greece.

An announcement said the IMF Executive Board has voted in favor of disbursement of the above sum to Athens.

A total of 14.6 billion euros of the IMF's total 30 billion euro share of the support loan has already been disbursed.

The loan to Greece, the largest ever given out by the IMF, was agreed in May 2010.

The majority of the Executive Board expressed satisfaction with the progress achieved by Greece thus far, but noted that structural changes need to be sped up for the successful implementation of the Greek economy's stabilisation program.

Greece's representative to the IMF, Panagiotis Roumeliotis, briefed the Board on the outcome of last Friday's eurogroup summit and the positive effects of the eurozone decision to extend the loan repayment period and reduce the interest rate for Greece, and in that respect asked the IMF to follow suit regarding its share of the EU/IMF loan, something that the Fund's general director Dominique Strauss-Kahn has been endorsing in recent months.

According to the IMF announcement, Greece has made further progress on its vital targets, which include putting the country back on a track of sustainable growth with the promotion of competitiveness, boosting the stability of the monetary and credit sector and securing viable fiscal finances.

The underlying fiscal and wider reforms necessary for achieving the middle-term targets of the program are gradually being put in place, although some important reforms need to be planned and applied for the creation of a critical mass that is necessary to support fiscal viability and economic recovery, the IMF said.

After the Executive Board meeting, IMF first deputy managing director John Lipsky said the Greek program made further progress towards achieving its targets and the performance remains close to the planned levels.

Along general lines, a measure of stabilisation has been achieved, Lipsky said, adding that greater emphasis needs to be placed on underlying reforms in the period ahead.

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