The Telegraph: IMF Pushes Greece To Give Up Autonomy Over Its Budget

British Newspaper The Telegraph published an article on how the International Monetary Fund (IMF) has indicated that Greece will have to give up autonomy over its budget as desperate last-minute negotiations continue regarding the country’s second €130bn (£109bn) bail-out.
With the country on the brink of a default, the article says, Christine Lagarde, the director general of the IMF, said that a new “fiscal compact” was set to be signed by European Union members at the vital leaders’ summit on Monday that would centralise budgetary powers. Greece is under increasing pressure to give up control of its budget. A document released over the weekend revealed German proposals to force Greece to pass all its spending decisions through a “budget commissioner”.

In an angry reaction from the Greek government, the education minister, Anna Diamantopoulou, a former EU commissioner, slammed the idea as “the product of a sick imagination” in an interview with local television.

On Saturday, Chancellor George Osborne said that the eurozone will have to put in place permanent fiscal transfer mechanisms such as eurobonds or direct payments.

In what were described by officials as his strongest words on the issue, the Chancellor said that transfers of wealth from creditor countries such as Germany to those struggling with debt, such as Greece and Portugal, were necessary.
It was the same as moving money from London to the north of England, he said.
“If you’re in a single currency as the UK knows, as the US knows, you have to transfer fiscal resources around the countries to make good the differences in regional competitiveness,” he said at the World Economic Forum in Davos.
(Source: The Telegraph)