WikiLeaks: IMF to Threaten Greece with Bankruptcy

The Greek government demanded an explanation from the International Monetary Fund on Saturday after a leaked transcript on WikiLeaks' website exposed plans by three top IMF officials to force the Greek government into accepting devastating debt repayment measures such as cutting pensions and raising taxes.  

A transcript placed on the WikiLeaks website is alleged to have taken place between Poul Thomsen, the head of the IMF’s European department, and Delia Velculescu, the Monetary Fund's mission chief for Greece.

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The officials were quoted as discussing a threat that the IMF might not participate in Greece's third bailout program as a way to force EU creditors, especially Germany, to reach a deal on debt relief before Britain's June referendum on whether to stay in the European Union.

"Basically we at that time say 'Look, you Mrs Merkel you face a question, you have to think about what is more costly: to go ahead without the IMF, would the Bundestag say The IMF is not on board? or to pick the debt relief that we think that Greece needs in order to keep us on board?' Right? That is really the issue," Thomsen was quoted as saying.

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The top IMF experts believe that a possible Greek default on its third bailout would coincide with Britain's possible Brexit and it would be hard for the EU to deal with two major events at the same time.

"This is going to be a disaster," Velkouleskou said during the meeting.

They also discussed whether Greece could apply more austerity as a condition for receiving more aid ahead of big debt repayments in July and voiced frustration at the European Commission's reluctance to side with IMF pressure on Athens.

EU and IMF lenders will resume talks in Athens on Grece's fiscal and reform progress next week aiming to conclude a bailout review that will unlock further loans and pave the way for negotiations on debt restructuring.

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