BRUSSELS (MNI) – If Greece goes to the International Monetary Fund
for aid, the euro and the credibility of the Eurozone could suffer,
European Central Bank Governing Council member Vitor Constancio said on
Tuesday.
Debt-stricken Greece is grappling to manage a budget deficit more
than four times the EU’s stipulated 3% limit and many market
participants say it could need external assistance to service its debts.
But European leaders are divided over whether support, if needed, should
come from within the Eurozone or from an international body, like the
IMF.
“Going to the IMF, as a member of the euro area, could be
interpreted internationally as some sign of weakness of our framework…
and that would be detrimental to the euro,” Constancio, who heads the
Portuguese central bank.
“Regarding the IMF, well, I as I think President Trichet said, I am
not in favour of saying that Greece should go to the IMF for a
programme,” Constancio said.
“We have the means to aid Greece ourselves,” he said. “The European
framework is capable of dealing with the problem.”
He said that the two functions of the IMF, providing a programme
for debt reduction and lending money, could be done at European level.
He said Greece already had a comprehensive budget programme which
was supervised by the European Commission, so there is “no added value
from the IMF in that respect.”
“The role of the IMF is to be a catalyst…and that’s something
that Europe can do and should do,” he said.
–Brussels: 0032 487 (0) 32 803 665, echarlton@marketnews.com
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