IMF suspends aid to Greece ahead of new elections

WASHINGTON - Agence France-Presse

The International Monetary Fund said Dec. 29 it was suspending financial aid to Greece under its huge rescue program until a new government is formed after elections slated for late January.

"Discussions with the Greek authorities on the completion of the sixth review of the program...  will resume once a new government is in place, in consultation with the European Commission and the European Central Bank," IMF spokesman Gerry Rice said.

Rice however assured that the holdup in the program would not impact the country's finances in the short term. "Greece faces no immediate financing needs," he said.

The sixth review of the IMF's four-year, $35 billion loan program for Greece, part of a much larger joint IMF-EC-ECB financial rescue, aims at ensuring the government is meeting particular budget and reform targets before releasing a new tranche of the loan.

Earlier Dec. 29 Greek lawmakers failed in a third attempt to elect a new president and Prime Minister Antonio Samaras proposed to hold a parliamentary election on January 25.

That sparked concerns that the far-left Syriza party could capture a dominant position in the legislature and roll back tough austerity measures required under the IMF program.