The Executive Council of the International Monetary Fund (IMF) will decide on Thursday, July 20, whether or not the Greek debt is sustainable, Bloomberg reports.

In a statement to Bloomberg, the IMF’s European Department Director Poul Thomsen claims that the debt sustainability analysis (DSA) for Greece is ready and it is negative. IMF’s technocrats do not believe the Greek sovereign debt is on a sustainable trajectory.

The IMF’s DSA report focuses on the objective of allowing Greece to return to market borrowing, without the support of the European Stability Mechanism and the IMF.

Once again, for the IMF the only road goes through debt-relief.

According to Kathimerini’s sources in Washington, the DSA report is based on the assumption that Athens will be able to maintain a high primary surplus for a number of years, in line with the projections endorsed by European creditors. Nonetheless, the Greek sovereign debt does not appear to be in a sustainable trajectory without an outright haircut., that is, a non-starter for European creditors.

A haircut is a non-starter for European creditors.

According to the IMF, by 2030 Greece will have to spend up to 20% of its GDP to service its debt, which is unsustainable. And it is also likely that the Greek banking system will need further refinancing to the tune of €10bn.

More significantly, for the IMF debt reduction is critical for generating the confidence in the Greek economy, which currently is not attractive to foreign investors.

Speaking to CNBC in June, the IMF’s managing director Christine Lagarde made Washington’s demands explicit, asking for the deferral of interest payments, further extension of maturities, and a mechanism by which payments are linked to growth. Similar calls were echoed by the EU Commissioner for economic affairs, Pierre Moscovici.

Still, the IMF will once again demand more debt-relief measures.

However, given the forthcoming German legislative elections in September 2017, these demands are not likely to be met. As the Greek programme expires in August 2018, it is likely that the IMF will remain in the Greek programme only as a consultant, without disbursing any payments.

For several months, Berlin’s insistence that IMF participates in the Greek programme delayed the disbursement of a  €8,5bn tranche, undermining confidence in the Greek economy. The disbursement was approved in June, after the IMF accepted that the Greek sovereign debt is viable “in principle,” but with the understanding that any IMF funds would be disbursed towards the end of the programme, pending another “review” of the programme’s viability.

Once again, the IMF’s “standby” {to disburse funds} arrangement with European creditors is called into question.