The
Committee for the Abolition of Illegitimate Debt (CADTM) draws
attention to two IMF documents dating from March and May 2010 that
were kept secret. These authentic documents were placed at the
disposal of the Truth Committee on Greek Public Debt by Zoe
Konstantopoulou, the President of the Hellenic Parliament in office
from 6 February to 3 October 2015.
Their
contents are damning. They clearly show that a large number of IMF
Executive Board members expressed severe criticism of the programme
the Institution was preparing to implement. Some of them denounced
the fact that the programme was aimed at rescuing the private
European banks – mainly certain major French and German banks—
who were creditors of Greek debt, both public and private. Several of
them denounced the selfsame policies that had led to the Asian crisis
of 1996-1997 and the Argentine crisis in 2001.
Several
executives denounced the fact that the principal executive officers
(mainly the Managing Director Dominique Strauss-Kahn and the Deputy
Director John Lipsky) had, unbeknownst to the other members of the
Board, modified one of the fundamental rules that condition credits
allocated by the IMF to its members. Indeed, for a loan to be granted
by the IMF, it must be shown that this loan and the accompanying
programme will render debt repayment sustainable.
This
condition could not be satisfied in the case of Greece, since the IMF
directorate and the European authorities refused to reduce the Greek
debt or to make private banks contribute.
Therefore
the above-mentioned condition was deleted on the sly, and replaced by
a new criterion: the need to avoid a high risk of international
systemic financial destabilization. The IMF’s Management invoked
urgency to justify this totally irregular change of the rules.
To persuade
the IMF executives who were the most reticent, the French, German and
Dutch directors lied, each promising that their country’s banks
would not disengage from Greek bonds. They claimed that the French,
German and Dutch banks would hold onto their Greek bonds to enable
the newly-starting programme to succeed.
Since then
it has been proven that the French, German and Dutch banks massively
sold off the bonds they held on the secondary market, thus
aggravating the Greek crisis and transferring to European tax-payers,
especially Greek tax-payers, the burden of the risks they had taken
and of the crisis which was largely their fault.
Full
report:
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