The International Monetary Fund (IMF) needs to reach an agreement with Greece and its European creditors by next week to ensure that the fund has enough time to give money to the embattled nation.
Greece has been seeking debt relief — a relaxation of the terms for paying back its debts — since 2015, but the issue has dragged on due to opposition from several EU member states. Certain European countries, some of which are the largest lenders to Greece, are against significant debt forgiveness as they don't want to be seen by their citizens as ongoing contributors to what they see as economic malpractices in their southern European neighbor.
Speaking to CNBC Tuesday, Poul Thomsen, the IMF director for Europe, said that there needs to be an agreement at a meeting late next week.
"We really need an agreement at the Eurogroup next week," Thomsen told CNBC's Joumanna Bercetche.
"Time is running out," he said, "but if there is an agreement in the Eurogroup meeting in May, then there will be enough time for us to activate the program and for it to coincide with the remainder of the ESM (European Stability Mechanism) program."
The Eurogroup is a regular meeting for all the finance ministers from those countries that share the single currency, while the ESM is the organization that deals with bailing out struggling nations in the region.