In a report released in June 2013, the International Monetary Fund came about as close as any large, politicised organisation ever does to admitting it has made mistakes. The report on the Greek bail-out of 2010 acknowledged that there should probably have been deeper debt restructuring, rather than simply switching the embattled sovereign’s excessive burden from private to official creditors.
That failing may well have prolonged fiscal austerity and the resulting recession. But in 2013, even the greatest sceptic would have to recognise that Greece has made progress. The country is finally reporting a primary budget surplus excluding debt repayments – a vital prerequisite to reducing its debt burden. Against all odds, Greece has avoided nationalising three of its largest banks. In fact, their rights offering received an enthusiastic reception from those investors with sufficient risk appetite.
