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Economy

IMF approves next tranche of bailout money to Greece

The International Monetary Fund (IMF) has agreed to release the next installment of bailout money to Greece. The institution deemed the debt-stricken country's reform efforts "impressive."

The IMF executive board announced its decision late on Wednesday after a long delay drawn out by Greece's political crisis that arose from the economic recession. The next tranche scheduled to be disbursed is worth 3.24 billion euros ($4.31 billion).

"The program is moving in the right direction, with strong fiscal adjustment and notable labor-cost competitiveness gains," Managing Director Christine Lagarde said in a statement.

The bailout funds come from a four-year program worth 172 billion euros approved by the IMF early last year. Under the so-called Extended Fund Facility (EFF), Greece receives more in financial assistance than what it could normally borrow from the Washington-based institution. Including the tranche approved on Wednesday, Greece has thus far received 4.86 billion euros under the plan.

Lagarde noted that the IMF had revised future criteria for the Greek government to continue receiving money.

"While the program has been adjusted to take account of the deeper recession and implementation capacity, the strategy remains focused on restoring growth, competitiveness, and debt sustainability," said Lagarde.

Greece must make further overhauls to its banking and taxation systems in order to reduce its debt burden and, ultimately, protect public interests, she added.

Greek Prime Minister Antonis Samaras' government implemented deep-cutting austerity measures last year in order to convince its international creditors to release more bailout funds. The widely unpopular economic policies, which sparked numerous demonstrations and strikes throughout late 2012, ultimately won over lenders.

In December, eurozone finance ministers granted the debt-laden country 34 billion euros from the EU rescue fund ESM, as well as an additional 15 billion euros to be released during the first quarter of 2013.

kms/jm (Reuters, AFP, dpa)