Debt crisis could still spread to EU core: IMF

The IMF said it stood ready to provide more aid to Greece if requested, though the country that triggered the sovereign debt crisis in 2009 still had plenty of untapped options for raising extra cash itself through privatizations.

Government sources in Athens meanwhile said international inspectors checking on Greece's compliance with its EU/IMF rescue package had found problems and were pressing for deeper spending cuts to cover a revenue shortfall.

"Contagion to the core euro area, and then onwards to emerging Europe, remains a tangible downside risk," the global lender's latest economic report on Europe said.

Finance ministers of the 17-nation single currency area are set to approve a 78 billion euro rescue plan for Portugal next Monday after Finland's prime minister-in-waiting clinched a deal to ensure parliamentary approval of the package.

But markets are increasingly concerned that Greece may never be able to pay back its 327 billion euro debt pile and will have to restructure, forcing losses on investors with severe consequences in the euro zone and beyond.

Asked whether there could be new aid package to help Greece work through its fiscal recovery program, the IMF's European department director, Antonio Borges, said the fund was open to the possibility.

"The Greeks have to take the initiative, and so far they have not approached us. The IMF stands ready (to provide additional support) as a matter of policy," he told reporters.

However, Athens also had the potential to raise funds by selling state assets, with the 50 billion euros mentioned as a possible estimate of revenues from a privatization program "probably less than 20 percent of all the assets the Greeks could privatize."

The semi-annual IMF report said peripheral members of the euro zone needed to make "unrelenting" reform efforts to overcome the debt crisis and prevent it spreading further.

It also urged the European Central Bank to tread carefully on further rises in interest rates after last month's first increase since 2007, saying euro zone monetary policy could "afford to remain relatively accommodative."

Borges said the program of austerity measures and structural reforms agreed a year ago was "probably the best thing that can happen" to Greece, though there was always the question of whether it was too ambitious.

Greece has implemented harsh cuts in public spending, public sector wages and pensions but has struggled to raise revenue due to a deep recession and chronic tax evasion. The government faces growing resistance to austerity highlighted by a general strike on Wednesday.