Lagarde doubts IMF's role in Greece bailout

The head of the International Monetary Fund (IMF) has questioned its participation in Greece’s €86bn bailout on Friday.

The IMF and the Europe are at odds on Greece’s future. Europe is more optimistic about the country’s GDP growth, debt ratios and fiscal surplus. The IMF, on the other hand, has called for lower fiscal targets, big debt restructuring before they will consider committing any money.

Speaking at an event in Austria with the country's finance minister Dr Hans Jörg Schelling, Christine Lagarde said Greece’s debt was unsustainable as it is close to 180% of GDP.

Largarde said: "We believe for us to be engaged under a programme, a debt operation would have to be assessed on the basis of a new debt sustainability analysis that would be handled on the basis of reforms conducted, the general framework, and growth assumptions that will all be adequately measured later on."

The IMF agreed in principle to a chain of undetermined long-term debt relief for Greece at the end of the bailout in 2018 at a meeting in May, but there was no formal agreement.

As reported by the Financial Times, Lagarde said: “You measure, you determine what is the likely growth, the cost of financing, and see if [the deal] can walk with two legs.”

She added: “We do not have a programme with Greece. The IMF is engaged and was very well represented at the May meeting during which lots of discussions took place”.

In Luxembourg on Thursday, eurozone finance ministers approved a payment of €7.5bn of aid to Greece, which is part of the €86bn bailout agreed last year.