Saturday, July 02, 2011

€12 Billion EU payment to Greece, who pays what and where stands Lagarde's IMF?

This blog is being updated as more information arrives, go to the end of the posting for most recent reports.

The Financial Times ran a report on Google News at around 7 pm this evening that the release of funds to Greece had been approved, but the linked article tellingly headlined they were only "set" to approve the transfer.

The Daily Telegraph, however, had reported the Finance Ministers of the Euro Group had signed off on the deal just after lunch in England, and in good time for Sir (hahaha) Mervyn King to watch the Ladies Finals from Wimbledon!

Reuters reports that Poland, which took over the rotating Presidency of the EU yesterday, slammed the EU over its handling of the crisis, while praising the IMF, a report or comment from which body, the world waits with baited breath......

UPDATE AAA 8:15 pm GMT The Wall street Journal reports the deal is agreed as follows:

The ministers signed off their portion of the €12 billion ($17.39 billion) loan tranche in a conference call Saturday evening. The International Monetary Fund is expected to approve its part of the loan next week.

This is particularly interesting as when the US Deputy Managing Director was in charge, he had stated IMF rules would prevent them paying their share of this tranche under the first bail out, as financing could not be assured for Greece in the coming twelve months. To even pretend that is a likely possibility at the moment, without the IMF, is a complete farce.

Update BBB 8:25 GMT The German State Broadcaster Deutsche Welle reports the following:

As was widely anticipated, the ministers signed off on the release of the 12-billion-euro ($17.5 billion) aid payment, the fifth tranche from a 110-billion-euro ($160 billion) bailout granted by the European Union and International Monetary Fund last year. Athens urgently needs the money by mid-July to stave off bankruptcy.

The EU is putting 8.7 billion euros towards the loan, with Germany the biggest contributor. The loan decision was taken during a video conference call.

It appears that the amount has already fallen well short of the €12 billion target!

Update CCC 8:32 pm GMT Channel News Asia, reports the IMF board has approved its share of €3.3 Billion to what will become the biggest waste of money, so far, in history:

"Against this background and on the basis of the debt sustainability analysis by the (European) Commission and the IMF, Ministers approve the disbursement of the fifth tranche of the current Greek Loan Facility by 15 July following approval by the IMF Board," the statement said.

The IMF is expected to clear its share of the next tranche, 3.3 billion euros, in the coming days. The eurozone's slice amounts to 8.7 billion euros.

So is the IMF portion contingent on Bail Out 2 being agreed in the next few days or NOT? 

More tomorrow - Goodnight!

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