Thursday 26 May 2016 8:59 am

IMF will not join Greek bailout until clear steps on debt relief have been agreed

The International Monetary Fund (IMF) has said that it "hopes" to officially join the Greek bailout programme by the end of the year, but insisted it could not make any guarantees.

Earlier this week Greece agreed a €10.3bn (£7.8bn) deal to unlock funds from Eurozone to help it cover debt repayments due this summer. The programme was criticised by analysts and commentators, however, as a "missed opportunity" since concrete details on debt relief were absent.

The IMF said that it would not disburse its own funds to Greece until a full debt sustainability analysis had taken place and all of Greece's creditors have agreed a clear programme to reduce the burden of Greek debt. While there were sounds in that direction in this week's agreement, it was not enough for the IMF to proceed.

Read more: Every bit of Greece's €300bn debt pile

A senior official from the Fund said yesterday: "We are not in the situation where, as many in Europe had wanted, where the European disbursement that's taking place now is being accompanied by an outright disbursement by the IMF.

"That we are not doing because we still need to have that conversation on debt issues … We are not in a situation where the IMF can say we are ready to go ahead."

The Fund, however, said it was pleased with the progress that had been made in the latest deal, especially the recognition that "Greek debt is highly unsustainable".

"I am hopeful," a senior official from the Fund added, "that we will get to that point [IMF disbursement of funds] by the end of the year, but it remains to be seen."