Greece raided reserves at IMF to meet debt repayment deadline

Jessica Morris
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Greece is trying to unlock the final €7.2bn tranche from its EU/IMF bailout fund (Source: Getty)

Greece had to raid emergency reserves in its holding account at creditor the International Monetary Fund (IMF) in order to meet the deadline for its sizeable €750m (£544m) repayment.

An official told Reuters the cash-strapped country had been forced to tap into around €650m (£467m) from its holding account with the organisation.

"We made use of money in our holding account in the fund," the unnamed official said. "The government also used about 100 million of its cash reserves."

Each IMF members has two accounts with the fund, one where annual quotas are deposited, and another which can be used to make emergency payments.

Greece defied its more pessimistic commentators to make a €750m (£544m) transfer to its creditor the IMF, meaning it beat its deadline. The sheer size of the payment has led some to believe it would be unable to pay.

But Greek finance minister Yanis Varoufakis subsequently warned the cash-strapped country could run out of money in just two weeks saying that the financial situation was "terribly urgent".

"The liquidity issue is a terribly urgent issue. It's common knowledge, let's not beat around the bush," he told reporters in Brussels yesterday.

"From the perspective [of timing], we are talking about the next couple of weeks."

Greece must implement reforms before it can unlock the final €7.2bn tranche from its EU/IMF bailout fund and stave off bankruptcy.

While it has until the end of June to reach an agreement with its creditors talks continue to crawl.

Meanwhile, German Finance Minister Wolfgang Schaeuble has suggested the cash-strapped country should hold a referendum over the reforms it would need to get additional funding.

"If the Greek government thinks it must hold a referendum, then let it hold a referendum," Schaeuble said.

"That might even be a helpful measure for the Greek people to decide whether it is ready to accept what is necessary, or whether it wants something different."

But this was played down by Eurogroup chairman and dutch finance minister Jeroen Dijsselbloem who it would further delay Greece obtaining the funding it so desperately needs.

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