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Dijsselbloem calls on end of Troika, ESM to be turned into a European IMF

Head of Eurogroup, Jeroen Dijsselbloem decided to launch a revolution. In an interview to a German conservative newspaper, he called on the end of the EU Troika and the mutation of the European Stability fund into a European IMF. Behind Dijsselbloem’s proposal stands the powerful German Finance Minister Wolfgang Schaeuble who ultimately wants to free his beloved eurozone from the dictatorship of  foreign powers.

The European Stability Mechanism (ESM) – the euro zone’s bailout fund – should ultimately be turned into a European version of the International Monetary Fund, Dijsselbloeme told Frankfurter Allgemeine Zeitung (FAZ).

“I think it would make a lot of sense for the euro zone bailout fund ESM to be developed into a European IMF in the medium to long term,” Jeroen Dijsselbloem said.

He said that would also mean that Greece’s current “troika” of lenders – the European Commission, European Central Bank and the IMF – would need to be broken up in the longer term.

“The ECB feels increasingly uncomfortable in its troika role, and rightly so I think,” Dijsselbloem said, adding that the European Commission had other “important tasks” that it should concentrate on.

He said the ESM should “build up the technical expertise that only the IMF has at the moment”.

German Finance Minister Wolfgang Schaeuble has also proposed turning the ESM into a European monetary fund to improve the management of crises in Europe.

Dijsselbloem said the institutions should maintain their roles for Greece’s current bailout and said he still expected the IMF to decide on a new program, adding that it would be “most welcome” if this happened by the summer.

Germany, which holds elections in September, wants the IMF on board before new money is lent to Athens. But it disagrees with the IMF over debt relief and the fiscal targets that Greece should maintain after the bailout program ends in 2018.

Dijsselbloem said he did not expect the current review of Greece’s bailout program to be concluded quickly, adding that he did not think the institutions will complete it before a Eurogroup meeting in Malta in April.

Greece and its international creditors remain divided over the terms of a review, a senior euro zone official said on Thursday, a gap that will prevent Athens from getting fresh financial support. (FAZ via Reuters)

No crucial decision for Greece second review in expected at the Eurogroup meeting tomorrow Monday.

PS I do not know, what makes Dijsselbloem so sure that he will keep his position at the Eurogroup after his Labor Party lost big in the Dutch Elections. Maybe he tries a last desperate help call to papa Schaeuble.

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