The fund is also prepared to provide a symbolic loan of up to €1.6 billion as a sign of good faith.

By BJARKE SMITH-MEYER, politico.eu

The International Monetary Fund Thursday agreed “in principle” to join Greece’s €86 billion bailout package, ending a long standoff between it and eurozone finance ministers that had threatened the rescue.
 
The IMF’s executive board voted Thursday in favor of the “precautionary standby arrangement” that it agreed with eurozone finance ministers last month, paving the way for the Fund’s participation in the Greek program.
 

The IMF is also prepared to provide a symbolic loan of up to €1.6 billion as a sign of good faith, if EU creditors deliver more detail on further debt relief measures for Athens once the program ends next year.

Eurozone finance ministers and the IMF have been at odds over the debt sustainability of Greece’s third bailout package since last year. The Fund had even threatened to walk away from the program if EU creditors offered the Greeks no further debt relief, which would have derailed the entire package.

Thursday’s vote puts an end to that uncertainty, although IMF participation was largely expected after it reassured eurozone finance ministers last month that it would join the Greek program. And that agreement unlocked a total of €8.5 billion in bailout cash from Greece’s EU creditors to the impoverished country.

The eurozone’s bailout arm — the European Stability Mechanism — transferred €7.7 billion of that cash to Athens earlier this month. The ESM will disburse the remaining €800,000 in September, once Greece makes “significant progress” on reducing its government arrears.