The prospect of extending an automatic spending cuts mechanism beyond 2018 is apparently one concession being considered by the leftist Greek government in order to promote a compromise between the IMF and European creditors on the Greek program -- and especially towards concluding the now delayed second review of the third bailout.
FinMin Euclid Tsakalotos hinted at the prospect, in fact, in statements carried by the Sunday edition of "Kathimerini", in answer to a question over whether his government is willing to take the additional austerity measures demanded by the IMF in order for it to rejoin the program as a lender.
The IMF's top analysts have repeatedly maintained that an annual 3.5-percent primary budget surplus target by Greece is unrealistic, adding that if the fiscal goal remains, then additional measures by Athens will be necessary.
"In the very unlikely case where the IMF breaks its very impressive track record of forecasts and one actually comes true -- i.e. a primary budget surplus as a percentage of GDP of roughly 1.5 percent after 2019 -- we have said that we can outline the measures, if such a case arises... Within this framework we are discussing a contingency mechanism ..." Tsakalotos said, in referring to the automatic spending cuts mechanism, dubbed by Greek media and the opposition as the "cutter".
