No, it’s not a joke. In IMF’s scores-reviews published on Monday, International Monetary Fund among other “applauded itself for the success of its bailout programs”… Hm… should I mention the wrong predictions on recession? The bailout programs that crash the health care system? The end of welfare state? The grabbing of social contributions translated into sharp pension cuts? The peanuts instead of minimum wage? The tearing apart of social cohesion? I think the guys and girls have a kind of sick sense of humor…
Lagarde – Rehn – Stournaras: To shake it or not to shake it?
IMF: Coordination with EU on Bailouts “Challenging”
“Coordination between the International Monetary Fund and euro-area officials, including the European Central Bank, on bailout programs has been “challenging” at times, the IMF said in a new series of reports published Monday.
In a review of scores of the IMF΄s loan programs doled out in the past decade, the fund also said it could strengthen its debt-sustainability analysis, a key metric of a program΄s viability, Dow Jones Newswires reported.
The assessment comes amid reports there are often disagreements between the fund and its euro partners, the ECB and the European Union, that have complex vital bailout programs. It also follows strong criticism from some economists outside the fund who have questioned the IMF΄s credibility on agreeing to a Greek bailout program they΄ve said has been flawed from the beginning. In particular, those economists have questioned the accuracy of the fund΄s debt-sustainability analysis and whether restructuring of Greece΄s debt should have been considered earlier in the program than it was.
“Program design and coordination in high-debt crisis programs has been challenging,” the IMF said. It cited euro-area bailouts in particular, where the fund advocated very ambitious policy adjustments given the size of the economic problems and the risk to the rest of the currency union.
“Institutional constraints in the [euro area] occasionally limited alternative policy options that could otherwise have been considered–notably, debt restructuring to strengthen debt sustainability (particularly for bank debt in Ireland and sovereign debt in Greece),” the fund said.
That requires the fund to improve partnerships with other institutions, said Dominique Desruelle, Deputy Director of the fund΄s Institute for Capacity Development and Ranil Salgado, Division Chief of the fund΄s Strategy Policy and Review Department.
The fund economists also said the IMF needs to develop better stress tests to assess the risks to programs, including bolstering the fund΄s debt sustainability analysis.
Overall, however, the IMF applauded itself for the success of its bailout programs. Specifically, the studies assessed the conditions set by the fund on its loan programs, measuring their effectiveness.” (Capital.gr)