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IMF chief backs Greek loans extension

 Pensioners attend a rally against the Greek government's austerity measures, outside the Ministry of Finance in central Athens, on Tuesday, Dec. 7, 2...
 Greek Prime Minister George Papandreou, right, welcomes the head of the International Monetary Fund Dominique Strauss-Kahn at his office in Athens on...
 Greek Prime Minister George Papandreou, left, speaks with the head of the International Monetary Fund Dominique Strauss-Kahn at his office in Athens ...
 Pensioners chant slogans during a protest against the Greek government's austerity measures  in central Athens, on Tuesday, Dec. 7, 2010. The protest...
 Pensioners chant slogans during a protest against the Greek government's austerity measures, outside the Ministry of Finance in central Athens, on Tu...

Greece Financial Crisis

Pensioners attend a rally against the Greek government's austerity measures, outside the Ministry of Finance in central Athens, on Tuesday, Dec. 7, 2...

Greece Financial Crisis

Greek Prime Minister George Papandreou, right, welcomes the head of the International Monetary Fund Dominique Strauss-Kahn at his office in Athens on...

Greece Financial Crisis

Greek Prime Minister George Papandreou, left, speaks with the head of the International Monetary Fund Dominique Strauss-Kahn at his office in Athens ...

Greece Financial Crisis

Pensioners chant slogans during a protest against the Greek government's austerity measures in central Athens, on Tuesday, Dec. 7, 2010. The protest...

Greece Financial Crisis

Pensioners chant slogans during a protest against the Greek government's austerity measures, outside the Ministry of Finance in central Athens, on Tu...

The International Monetary Fund is backing plans to extend Greece's repayment of bailout loans but is urging the European Union to seek a "comprehensive solution" to the continent's government debt crisis.
Greece is currently negotiating terms of repayment for the three-year (EURO)110 billion ($150 billion) bailout loan that saved the debt-ridden country from default in May. The loan package ends in 2013, but analysts and officials have been concerned over Greece's ability to cope with the large debt repayments it would face afterward, in 2014 and 2015.
"We saw there was a problem of the length of the period of repayment, and I'm advocating the fact that we should lengthen this period," IMF chief Dominique Strauss-Kahn said Monday during a one-day visit to Athens.
Last month, European Union governments agreed to look into extending the repayment deadline for Greece from three years to 7 1/2 years, bringing the Greek loan package in line with one agreed recently for Ireland. The terms of the repayment _ the timing schedule and whether it will include the full (EURO)110 billion or just the portion still to be disbursed _ have not been decided.
Strauss-Kahn said a decision would have to be taken by the IMF and EU together, and that "my view is that more and more people in the European Union understand there's a need to do something like this."
"It's not an urgent question, but there's no reason to wait too much," Strauss-Kahn said during a joint news conference with Greek Prime Minister George Papandreou. "And on our side we are ready to do it."
Facing a mountain of debt and a deficit that stood at 15.4 percent of gross domestic product in 2009, Greece's Socialist government has imposed tough cost-cutting measures, including reducing civil service salaries, trimming pensions and increasing consumer taxes, in order to receive the bailout loans.
On Monday, Jose Manuel Barroso, head of the European Union's Executive Commission, said in Brussels that the EU had already decided in principle to extend Greece's loans.
"This was a crucial decision for the credibility of the program. The technical details are under study and should be finalized soon," Barroso said.
Strauss-Kahn said Greece's priority now should be to restore growth.
"What has to be the most important thing in the coming months is to restore growth. Because without growth there's no solution to the problem of the country," he said.
The IMF chief also met with top Greek finance officials and was to speak at a parliamentary economic affairs committee.
Greece is not the only eurozone country to be facing problems, and Strauss-Kahn advocated a comprehensive solution to the European debt crisis.
"We believe in the IMF that dealing with one country, then dealing with another country, maybe tomorrow with a third country, is not a good way of addressing the problem," he said.
While he disagreed with those saying the debt crisis puts the future of Europe's single currency at stake, he said the problem is one that needs to be addressed.
"Of course, a comprehensive approach has to be discussed among the members following the rules of the eurozone, takes some time. But I'm confident that they will make it," he said.
The measures have angered labor unions, which have organized a series of demonstrations and strikes.
On Tuesday, about 500 pensioners marched through the city center ahead of Strauss-Kahn's arrival to protest the austerity measures, while about 2,000 protesters from a communist-backed union rallied outside Parliament when he was due to address the legislature's economic affairs committee.
"We are to protest the black alliance of the IMF, the government and big business," said student protest organizer Sofia Emmanoulla. "They claim to be taking measures for our benefit while they cut our wages, pensions and working rights."
Strauss-Kahn said he understood why people were upset at the measures and why they would chant "IMF go home."
"But really, you're better off with us here than with us home. And the sooner we will be able to go home, the sooner you will be able to fly alone, the better it is," he said.
"So don't fight against the doctor. Sometimes the doctor gives you medicine you don't like. but even if you don't like the medicine, the doctor is there to try to help you."


Updated : 2021-10-23 04:39 GMT+08:00