BUSINESS

Greece's debts unsustainable despite progress, IMF says

The Associated Press Published Monday, February 6, 2017 9:35PM EST

People stand in a queue to use an ATM outside a closed bank, next to a sign on the plant, bottom right, reading 'NO' in Athens, Tuesday, June 30, 2015. (AP / Thanassis Stavrakis)

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WASHINGTON - The International Monetary Fund says Greece, which has been struggling for years with high debts and painful rates of unemployment, is making progress toward reducing its massive budget problems and restoring economic growth.

But the IMF says the country's debts remain "unsustainable" over the long term.

The IMF predicts Greece's economy will reach long-run growth of just under 1 per cent a year, unimpressive but an improvement on years when the economy was shrinking. And Greece will meet the IMF's target by reporting primary annual budget surpluses - which do not include interest payments - equal to 1.5 per cent of economic output.

Since the financial crisis left it buried in debt, Greece has made painful budget cuts that caused a deep recession. Unemployment is 23 per cent.