A Sobering IMF Debt Report on Greece

The just-released IMF’s DSA (debt sustainability analysis) for Greece offers a stark reminder of the challenges faced by all those involved in this horrid tragedy.

It points to an enormous need for economic reforms by a country that – repeatedly – has had huge difficulties sustaining a less ambitious effort under several governments.

It speaks to the need for Europe to bite the bullet and deliver a credible “debt operation” (which, most probably, would involve debt forgiveness, the very mention of which has proven an anathema to some European governments).

And all this would need to happen if the IMF (and soon, possibly, also the ECB) is to stand a chance of being paid back in a full and more timely fashion.

While all sides are likely to use the IMF’s DSA to bolster their case ahead of Sunday’s referendum, it is increasingly possible that even a “yes” vote would prove insufficient to maintain the country’s membership of the European single currency.

Every single day, an already challenging situation on the ground slips further away from the ability of politicians, whether in Greece or elsewhere in Europe, to control and deliver outcomes.