IMF’s bailout threat a challenge to Germany

The IMF’s threat to pull out of bailouts for Greece unless European partners grant Athens massive debt relief poses a stark challenge to Germany, the biggest creditor, which insists on IMF involvement in any future rescue.

The global lender has made itself unpopular with both sides in the Greek debt saga by playing its role as a teller of inconvenient truths without excessive diplomacy.

Its latest intervention, saying in essence that Greece will never be able to repay its debt mountain, is bound to sharpen debate when the German parliament meets tomorrow to decide whether to authorise negotiations on a third bailout for Greece since 2010 that could cost an extra €85bn.