IMF halts bailout talks with Greece, citing lack of progress

By IAN TALLEY & GABRIELE STEINHAUSER, Market Watch

The International Monetary Fund said it was halting bailout talks with Greece in a stark signal of its exasperation about a lack of progress toward a deal to avert a Greek default, as European leaders suggested negotiations were nearing their endgame.

“There are major differences between us in most key areas,” said IMF spokesman Gerry Rice in an unusual public statement aimed at heightening pressure on the left-wing government of Prime Minister Alexis Tsipras.

“There has been no progress in narrowing these differences recently,” he said. “Thus, we are well away from an agreement.” He added that the IMF team negotiating with Greece had been pulled out of Brussels, though the fund remained ready to resume talks. “The ball is very much in Greece’s court right now,” he said.

With its announcement, the IMF put an official halt to negotiations over terms of the bailout between Greece and the institutions overseeing the rescue program, including the European Commission and the European Central Bank. Those talks had been on pause for several days already.

But making the break public significantly increases pressure on the government in Athens to sign on to unpopular policy overhauls and spending cuts—or risk a default on its debt and even greater financial chaos.Discussions among political leaders to resolve the crisis were set to continue, despite the IMF pullout. The fund’s managing director, Christine Lagarde, is scheduled to head to Europe next week, where she will likely meet with top eurozone officials to discuss the failing bailout talks.

Still, the IMF’s move and statements from European officials and leaders signaled that efforts to reach a bailout agreement were entering a new and decisive phase.

“The day is coming, I’m afraid, that someone says the game is over. We have no more time,” Donald Tusk, the president of the European Council, said after talking to Tsipras on Wednesday. The Greek prime minister had also held a late-night meeting with the leaders of Germany and France.