Athens crisis worsens as Europe’s Juncker gets his sums wrong | City & Business | Finance

The IMF warned Athens will fail to meet its primary budget surplus next year in stark contradiction to European Commission estimates.

And the Washington-based fund says Greek government revenues will decline sharply next year and could require them to have a fourth bail out.

The citizens of Greece have been pulling money out of their accounts over fears of yet another run on banks.

Capital outflows are leaking out of the country’s banks at rates not seen for 16 years with worried citizens removing billions since the start of the year.

Last month business and household deposits fell to 119.07 billion euros (£100 billion), the lowest amount since October 2001, from 119.75 billion euros in January, when they decreased by £1.36 billion.

Protestors feeling the true cost of the debt crisis have been on the streets on an almost weekly basis as PM Alexis Tsipras tries to paper the cracks.

But now the IMF, during its Spring conference, says the country’s position is nothing like what the European Commission, led by chief eurocrat Jean-Claude Juncker, has been predicting.

Athens surplus will increase marginally to two per cent next year a whole 1.5 per cent off its target 3.5 rate.

And more worryingly analysts say that a recent boost to revenues is “temporary”.

Vitor Gaspar, director of fiscal affairs at the IMF said: “The surplus in 2016 is likely to have been much stronger than we had expected.

“But that was largely due to temporary factors.”

In a report published yesterday the IMF downplayed the country’s revenues expectations from 50.3 per cent of national income to 47.3 per cent. 

The European Union has been pushing Greece to maintain a 3.5 per cent surplus for three years but the country is failing to do so.

Now the IMF is calling on debt relief methods to be pushed through with a further €6bn (£5bn) required by July to stop it defaulting. 

Mr Gaspar added: “Ensuring that Greek debt is sustainable requires a second leg of this programme for Greece, which is debt restructuring on the part of the official creditors.”

Earlier this month it was revealed that the European Union (EU) has a growing debt mountain of £203billion (€238billon) and has admitted difficulties in paying its bills.

The European Commission (EC), which oversees the budget and is run by unelected president Mr Juncker, says it tried to make the funding crisis “disappear” .

Luxembourg politician Mr Juncker, who represents the European People’s Party (EPP) and earns €304,212 per year plus allowances of as much as 15 per cent more, took over the budget of the bloc in 2014.

But according to the latest “past due” figures, which the EC also calls “payment backlogs” and “reste à liquider” or (RAL), the funding gap has shot up dramatically in less than two years.

The most recent officially reported figures were made public in a document issued by the European Commission in 2015 and were calculated at £22bn (€26bn).

However, the EC is now facing an unprecedented crisis after it admitted to…

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