Content about International Monetary Fund

After completing a mission to Belarus, the International Monetary Fund (IMF) called on Minsk to commit to a “consistent strategy based on stabilisation and reform” to secure financial aid. “Programme negotiations would require agreement among all policy makers -- including at the highest level -- to adopt a comprehensive package to restore stability and to embark on the path of deep structural reform,” the IMF reported released on 17 May read. 

There are converging estimates that a potential Greece's exit from the Eurozone may cost up to one trillion. A large part of it will be born by this country itself. It will income losses over a number of years, due to an unprecedented recession and uncontrollable inflation. The largest part of it however will be born by the other weak Eurozone countries. There will be also huge losses for central countries like France, Germany and Holland due to the exposure of their lenders to the Greek banking system.

With the dignitaries in Brussels, Berlin, Paris and Washington having already termed the next Greek legislative election a referendum, with one question to be answered by voters 'stay or leave the Eurozone', Greek citizens continue to be bewildered.

Hungary is ready to change its economic policies in light of talks with the IMF and EU, and lawmakers will have to attend sessions until the mid-July because the situation in Europe could require a response by the Hungarian parliament.  This is the message that Hungarian Prime Minister Viktor Orbán relayed in a press conference after a meeting of the ruling alliance’s parliamentary group on 14 May.

Speaking in Baku, International Monetary Fund (IMF) Middle East and Central Asia Department (MCD) Deputy Director Nadeem Ilahi said prospects for the development of Azerbaijan's economy in the short term are generally favourable, news agencies reported. He recalled that last year the main indicator of economic development of the country namely the non-oil GDP grew by 9.9%, marking a good indicator.

The political agenda of President-elect François Hollande was broadly based on the promise to restore a more just distribution of income within French society, going to such extremes as to include a 75% taxation rate for high incomes, those exceeding one million euro per year. President Obama’s tax agenda includes similar, though not so provocative, provisions in order to finance his entitlement policies in favor of the poorer.

Given the chaotic political and economic environment that reigns in Greece after last Sunday's election, a disorderly bankruptcy in Athens becomes  more likely with every passing day.

Incidentally, on 15 May a foreign law bond of €450 million expires and it is not clear if Athens will pay it or not. The caretaker Minister of Finance, Philippos Sahinides, said he cannot take the decision to pay it or not alone and he has asked the political party leaders of the new Parliament to decide on that, but nobody seemes to care.

The formation of a government in Greece is becoming a burning issue for the entire Eurozone. The results of the Sunday 6 May elections tuned out an absolutely fragmented political scenery, with even a pro-Nazi group, the Golden Dawn, until last week a marginal bunch of bullies, getting 7% and 21 deputies in a house of 300. Another new extreme right-wing formation of 'Independent Greeks' got 10.6% and 33 deputies.

With Greece obviously ungovernable after yesterday's elections that turned out an  fragmented political landscape, and François Hollande's victory in the the presidential race in France, European capital markets opened today with heavy losses.

The Athens stock exchange started at 8.5% down, with the rest of bourses losing up to 2%. The euro also lost some ground.

To put their public finances back in order and to restore public finances to health, after the strong budgetary deterioration following the eruption of the credit crisis, the European countries need to reinforce their economic growth potential and, in many cases, budget deficits need to be forcefully curbed to below 3% of GDP. Doing so often requires a combination of spending cuts and tax increases. In addition, countries need to reinforce their economic growth potential, said Dutch Central Bank ‘De Nederlandsche Bank (DNB) in its analysis published on May 1, 2012.