Τα αποσπάσματα της συνέντευξης τύπου της Lagarde για την Ελλάδα

QUESTION – I was wondering what your assessment and expectations are after the Eurogroup meeting ahead of the EU Summit about Greece, where the country stands and what the prospects are.

MS LAGARDE – What I can tell you is that the work continues. We have a team on the ground fully committed, working very hard day and night, weekends included. They are going to continue doing that in order to resolve any differences, in order to address all the chapters of the Greek program.

As you know, we are at the stage of a review where we clearly have a list of items for fiscal consolidation purposes. We also have to review the structural reforms that Greece has committed to implement. We also have to look at the financing and the debt situation of the country.

From our perspective, all four chapters have to be looked at and we will spare no time or effort to actually do as much as we can in order to help Greece. Our purpose is to make sure that Greece is back on its feet, that it can one day return to markets, that it does not have the need for constant support, and that is what we are completely targeted for. We want to help the country and to help it stand on its own.

QUESTION – I would like to ask some questions about the research that appeared in the World Economic Outlook about fiscal multipliers; first of all, which countries you think are particularly exposed to these large fiscal multipliers. Secondly, given that you are now expecting austerity to have a far more detrimental impact on growth, how will your policy prescriptions for the Eurozone and elsewhere change?

MS. LAGARDE – I think you have had already part of the response from Olivier Blanchard, who is our Economic Counsellor, as you know, and who is the author of the World Economic Outlook. Just for the record, there is no difference between Olivier’s views and my views because we actually talked them through. What he gave you as a response is absolutely fine by my standards.

The set of options which I think he went through last night as well is, No. 1, the fact that time is of the essence, meaning that instead of frontloading heavily, it is sometimes better, given circumstances and the fact that many countries at the same time go through that same set of policies with a view to reducing their deficit, it is sometimes better to have a bit more time. That is what we advocated for Portugal; this is what we advocated for Spain; and this is what we are advocating for Greece, where I said repeatedly that an additional two years was necessary for the country to actually face the Fiscal Consolidation Program that is considered. So, that is one component.

Second, something that we have stated and that Olivier, I am sure, has indicated is that, in the circumstances and given the multiplier reassessment that we have produced, we do not think it is sensible to actually stick to nominal targets. We think it is much more appropriate to actually apply the measures and to let the stabilizers operate. Now, as far as countries are concerned, clearly that applies to pretty much all countries that, particularly in the Eurozone, are applying that policy mix.

QUESTION – [THROUGH INTERPRETER] Sub-Saharan Africa has been spared some of the difficulties of the world, but is still suffering from shock waves. Have you considered that and what recommendations do you offer to sub-Saharan Africa?

MS. LAGARDE – [THROUGH INTERPRETER] Thank you. You are quite right. The sub-Saharan African countries are less affected and currently have growth rates which are quite impressive  which make many other countries envious. Recommendations in terms of macroeconomic policies are certainly to maintain and reconstitute leeway in budgetary provisions to prepare for any difficulties or shocks if the situation worsens or if the sub-Saharan economies meet external shocks, in particular.

I would also point out here now that what we call the PRGT, the Poverty Reduction and Growth Trust, a financial reserve which has been set up to face the demands of developing countries in terms of concessional lending, this PRGT is replenished on a long-term basis. We had some fears about financing after 2014, but the institution as a whole voted in favor of replenishing the reserves of the PRGT by allocating to the fund the gold sale profits realized when the Fund made its gold sales a couple of years ago. We are ready to handle problems as they arise.

QUESTION – Madame Lagarde, given the risks that you see on the horizon, how would you assess the speed at which Eurozone leaders are implementing their latest decisions? I ask this in the context of the new ECB program. A lot of investors are starting to doubt whether the OMT program will even be tapped in the next three or four months. Do you think they are wrong and do you think it is a problem for a program like that not to be used in the coming months?

MS. LAGARDE – As with the case with the Eurozone, there is good news and bad news. The good news is the fact that this European Stability Mechanism that had been discussed and in the making for the last months has now been christened and is in operation as of Monday. They had their first Board meeting. A President has been appointed for the next five years. Capital is being released. That is the good news.

In terms of speed, the bad news is that, for it to actually operate, there will be a legislative and often parliamentary process that will be needed for the fund to effectively work. So, it is going to be a matter of parliamentary process, procedure, and practicalities, but that is the way euro instruments eventually work because they require the support and the consent of 17-member states that operate with their parliamentary institutions. It is a tradeoff between financial efficiency and democracy, on the other hand.

QUESTION – The European Central Bank called on the Fund to participate in the design and monitoring of programs that would be related to [?] interventions. Do you see the role of the Fund as similar or different to the work you have done in previous programs in the Eurozone? Would it be your advice to Italy and Spain to apply for such a program, although, of course, you would say it is the government’s decision, but what is—

MS. LAGARDE – You have given the answer.

QUESTION – But what is your advice? The job of the Fund is to give advice.

MS. LAGARDE – Seriously, it is for the members to decide what they need to do, what they want to do. In the context of the Eurozone, they often do that after consultation with euro partners, which is quite legitimate.

Our role is already different on the ground. Within the Eurozone we have three countries under programs and one in discussion. Three countries under programs are Greece, Ireland, and Portugal. The one in discussion is Cyprus. We also have standard financial arrangements that we have had in other parts of the world.

But in the case of Spain, for instance, in relation to the financial sector restructuring, the Fund is engaged and was engaged in the design and monitoring of the financial sector program. We will be sending a team on the ground for the first monitoring of the Spanish financial sector restructuring.

We are flexible, but when we monitor, we want to know that what we monitor is something that we are comfortable with, that makes sense from an economic point of view, which means that we want to also participate in the design. Typically, it is easier for us to operate within our established framework, which is what we have to do anyway, and it can vary from a standard SBA to the, as I said, design and monitoring function that we have in relation to the Spanish financial sector restructuring. Anything within that range is a possibility.

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