World Economy

Greece Cannot Repay IMF Debt

Greece Cannot Repay IMF DebtGreece Cannot Repay IMF Debt

Greece cannot make debt repayments to the International Monetary Fund (IMF) next month unless it achieves a deal with creditors, its interior minister said on Sunday, the most explicit remarks yet from Athens about the likelihood of default if talks fail.

“The four installments for the IMF in June are $1.8 billion. This money will not be given and is not there to be given,” Interior Minister Nikos Voutsis told Greek Mega TV’s weekend show, Reuters reported.

Asked about his concern over a credit event if Athens misses a payment, he said, “We are not seeking this, we don’t want it, it is not our strategy. Things have matured for a deal of logic.”

“We are discussing, based on our contained optimism, that there will be a strong agreement (with lenders) so that the country will be able to breathe. This is the bet,” Voutsis said.

After four months of talks with its euro zone partners and the IMF, the country’s leftist-led government is still scrambling for a deal that could release up to $7.9 billion (7.2b euro) in remaining aid to avert bankruptcy.

Previously, the Athens government has said it is in danger of running out of money soon without a deal, but has insisted it still plans to make all upcoming payments.

The government is under pressure to agree to more cuts and reforms to secure the funding, but opposes measures which it says make the situation worse by preventing recovery from one of the deepest recessions in modern times.

Voutsis said the government was determined to fight against the lenders’ strategy of “asphyxiation.”

“This policy of extreme austerity and unemployment in Greece must be hit,” he said. “We will not escape from this fight.”

Greek Prime Minister Alexis Tsipras also said on Saturday the government was on a final stretch toward a deal but would not accept “humiliating terms.”