Poul Thomsen, head of the IMF's misssion to Greece, during a visit to Athens in May
UPDATE: Here’s an interesting take on the same reports by our friends and rivals over at the Wall Street Journal.
As part of the Brussels Blog’s new mission to read brick-sized reports on eurozone bail-outs so you don’t have to, today we bring you the highlights of the 173-page International Monetary Fund review of the Greek crisis – which we reported on in today’s newspaper, but which has lots of other good details worth chewing over.
The first thing we like to turn to when getting these kinds of reports is the analysis of just how big the financing hole is for Greece – and how international lenders intend on filling it.
According to page 62 of the report (see the pdf here), the IMF has a slightly lower estimate of how big the Greek hole is than the European Commission: it believes Athens will need €103.4bn in new bail-out funds through 2014, while the Commission thinks it will be closer to €115bn.
Potentially more interesting, however, is how they propose to fill the hole.
The Italian finance ministry. Image by Bloomberg.
Italy has been in the news for all the wrong reasons, and a look at World Bank indicators on how easy is to run a business there might explain a few things: It takes 1,210 days to enforce a contract in Italy and it costs around a third of the contract’s disputed amount in legal costs – for those hardy enough to attempt to navigate the byzantine court system.
Businesses not willing to wait forty months to get their money back might want to try setting up shop in Luxembourg instead, where courts will process claims in a far more reasonable 321 days – and at a lower cost, too.
Those World Bank figures highlight the difficulties facing the European Union’s single market. Though goods and services can flow nearly seamlessly through the EU’s 27 countries, the laws and regulations that apply to them remain very different.