ATHENS: S$P cuts greece’s rating over prolonged talks with lenders. The Greece has been locked in talks with its EU and IMF creditors on economic reforms for months and risks running out of cash within weeks if it fails to strike a deal to unlock fresh bailout funds.
“Greece increasingly depends on favourable business, financial and economic conditions to meet its financial commitments,” S&P said in its report, which cut Greece’s rating to ‘CCC+’ from ‘B-’.
S&P said it expected the Greek government to be able to continue to pay salaries and pensions in cash, although fiscal income was weakening. But the agency warned that “without deep economic reform or further relief, we expect Greece’s debt and other financial commitments will be unsustainable”.
Germany’s finance minister said on Wednesday there was no prospect of the eurozone reaching a deal with Athens on economic reforms that would unlock bailout funds at an April 24 meeting of eurozone finance ministers in Latvia’s capital, Riga. S&P said it believed the Greek government will have exhausted its cash if there is no agreement by May 12, when Greece is due to make a €760 million payment to the IMF.
In the meantime, deputy Finance Minister Dimitris Mardas yesterday told reporters that Greece’s ordinary budget revenues in March stood at €4.2 billion, beating the country’s target of €3.2 billion.
