Transcript of a Press Briefing by Gerry Rice, Director, Communications Department, International Monetary Fund

IMF News, June 6, 2013

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Canonical URL: Transcript of a Press Briefing by Gerry Rice, Director, Communications Department, International Monetary Fund

Transcript date and location: June 6, 2013 — Washington, D.C.
Briefing embargo: embargoed until 10:30 a.m., Washington time.
Managing Director Christine Lagarde:
- Attending the G-8 summit on June 17 and 18 in Northern Ireland.
- Participating in the press conference for the Concluding Statement of the Article IV Consultation with the United States on June 14th at 11 a.m. at the Fund.
First Deputy Managing Director David Lipton:
- Attending the St. Petersburg International Economic Forum starting June 20th.
IMF publication:
- IMF's Biannual Work Program published today at 10:30 a.m.
Press Center: reference to IMF Press Center (password-protected) and e-mail notification sign-up.

Scope and timing:
- Evaluation refers to the previous Greek program which began in 2010, not the current program which began in 2012.
Purpose:
- The evaluation is presented as a rigorous self-assessment intended to learn and integrate lessons into future operations.
Context emphasized by IMF:
- The 2010 crisis was described as "in many ways unprecedented" and required quick response.
- Subsequent factors affecting outcomes included the depth of the global recession, the depth of the European recession, political uncertainties in Greece, and implementation problems.
IMF position on decision-making hindsight:
- "The evaluation report ... concludes ... that, in the same situation, with the same information, we would probably have made the same decision today."
Current program status:
- The current program "has already internalized the core lessons from the previous program."
- Article IV Consultation and program review reports indicate Greece "has made major strides in the fiscal area, in the financial area, in some areas of structural reform."

Troika composition and assessment:
- Troika = European Commission, European Central Bank, and the IMF.
- The report noted areas for improvement but concluded "the Troika has worked well, and the Troika is working well."
Differences with European Commission:
- The European Commission "fundamentally disagreed with the key findings of the report."
- IMF response: reiteration of contextual points and that "there is broad agreement" on some issues; IMF defers to each institution to make its own assessment.

IMF stance on new debt relief discussions:
- "We do not envision any new debt relief discussions on Greece at this juncture."
Projections and programmed debt targets:
- Further debt relief will be needed for Europe to meet its commitment to reduce Greek debt to:
- "124 percent of GDP by 2020"
- "substantially below 110 percent of GDP by 2022"
European partners' timetable:
- They "expect to review the country's case by the beginning of 2014 and 2015" and decide once fiscal outcomes are known.

Egypt:
- Technical discussions making "good progress."
- IMF receiving data and information "all the time"; awaiting resolution of remaining technical issues to conclude negotiations successfully.
Ukraine:
- Mission to Kiev ended in mid-April to discuss policies for a Stand-By Arrangement; technical discussions continue; no specific dates for next negotiating mission provided.
Democratic Republic of Congo:
- Reviews completed under the Extended Credit Facility: three reviews completed, three did not take place owing to lack of progress on governance and transparency.
- Further update to be provided later.
Portugal:
- Expectation: Board discussion of the 7th Review "around mid-June."
Cyprus:
- First review mission scheduled for late July; mission chief will participate in the mission.
- IMF view on Cyprus program:
- Macroeconomic assumptions take account of factors expected to affect growth in the short and medium run, including fiscal adjustment and recent policy actions in the financial sector.
- Expectation: "growth to resume in 2015" — conditional on "a favorable international tax regime, progress on structural reforms, institutional reforms, etc."
- Risks: "macroeconomic uncertainties and risks ... remain significant" and will be monitored closely.

Importance of data:
- "The accuracy of data is a fundamental aspect of an effective program."
- IMF makes extensive efforts to ensure data accuracy; outcomes depend on what authorities can provide.
Misreporting case in Greece:
- Board reviewed a case of misreporting by Greece related to a prior action for the first and second reviews last January.
- The Board "granted a waiver, given that there was prompt corrective action taken by the authorities" (area: tax administration).
Implementation and ownership:
- Noted evolution between first and second Greek programs: greater "ownership of the program and the implementation of the program" by Greek authorities.

Lessons documented in the report highlighted by IMF:
- Importance of the "right pace and the right mix on the fiscal side."
- Importance of "ownership and the importance of implementation by the respective authorities."
Application to other euro-area programs:
- IMF declined to draw direct parallels between Greek lessons and specific cases such as Cyprus to avoid confusion, but indicated these general lessons are relevant when working in a monetary union.

Transcript of a press briefing by Gerry Rice, Director, Communications Department, International Monetary Fund — June 6, 2013.