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Sylvain Charest, head of the International Monetary Fund (IMF), defended Greece’s fiscal pact on Sunday and said the country’s banks were in good shape from a liquidity standpoint at this point.

Charest, speaking alongside Prime Minister Alexis Tsipras, who is holding talks with the European Commission president, insisted that there is still time to meet the IMF’s condition for further bailout financing.

“It is important that the IMF agrees to continue assistance to Greece beyond the end of this year. However, if the Greek government does not reach a solution by the end of March 2018, its programme would be terminated, we would have to consider the whole programme as an option,” Charest said.
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According to Charest, the IMF is on firm ground with its position. However, the IMF is still awaiting a detailed memorandum of understanding (MoU) with the Greek government on the IMF’s stance.

“Our position is that the IMF’s main conditions, while they have to be respected, remains that Greece should stick to its fiscal consolidation plan. I expect that a detailed MoU to implement this plan is at some stage in the future – this I fully expect and I am certain of,” the French minister said.

Tsipras, speaking with his Greek counterpart, said the Greek government is ready to make compromises with the IMF but that the deal must be for the good of Greece and the Eurozone.

“There are a couple of conditions, but I believe a very good deal is possible. It depends on the Greek government, and what it says to the European Parliament in return. But it is clear that with this agreement this agreement can be done with very important European concessions. It is not a deal which we have to accept. We have a very good agreement with the ESM (Estonia’s currency swap mechanism), this is in line with our European commitments,” he said.

But Charest also pointed out that it was not impossible that it may still fall into the Eurocrisis – and that the IMF could still intervene if they see an immediate risk to the financial stability of the Eurozone. “The IMF does have its own mechanisms and it is prepared to intervene in our case if this is necessary,” the head of the IMF said.

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