Greece euro exit 'a potential': IMF chief

Agence France-Presse
International Monetary Fund Managing Director Christine Lagarde and German Bundesbank Governor Jens Weidmann chat during a meeting of finance ministers of the G7 group of nations on May 28, 2015 in Dresden, Germany.
Sean Gallup

Greece's exit from the euro zone is a possibility but would not signify an end to the single currency, International Monetary Fund chief Christine Lagarde said in a newspaper interview Thursday.

A Greek exit is "a potential," Lagarde told the daily Frankfurter Allgemeine Zeitung.

Such a scenario would not be "a walk in the park" for the single currency area, but would "probably not be an end to the euro," she said in comments translated into German.

"It's a complicated issue, and it's one that I hope the Europeans will not have to face because hopefully they will find a path to agree with the future of Greece within the euro zone," she said in a statement subsequently issued in Washington to clarify her comments to the German newspaper.

The IMF chief also rejected Athens' assertion that a deal with its creditors was imminent.

"It is very unlikely that we'll reach a comprehensive solution in the coming days," she said.

After positive signals had come from Greece 10 days ago, "we've been sobered again in the last week," Lagarde said.

There was still a lot of work to be done, she said, and the IMF was not prepared to pay out more funds without a clear reform pledge.

"We have rules. We have principles. There will be no half-baked program review," Lagarde said.

On Wednesday, Athens had announced that it was close to a loan deal with its creditors that would unlock badly-needed bailout funds for its struggling economy.

The Greek government subsequently back-pedaled after German Finance Minister Wolfgang Schaeuble — who is hosting a meeting of Group of Seven finance ministers and central bank governors in Dresden — had retorted that no significant breakthroughs had been achieved.

Lagarde is currently attending the G7 meeting.

A Greek government spokesman said Thursday they hoped for a deal by Sunday.