SHANGHAI: Cash strapped Greece managed to make a 200-million-euro (US$222 million) repayment to the International Monetary Fund here the other day, as its long-stalled bailout negotiations appeared to make some progress.
Greece has a much larger repayment due next week that it will struggle to manage. On Tuesday, Greece must repay about 770 million euros to the IMF — and it is not clear whether it will be able to meet both that payment and pay some pensions and salaries due mid-month.
Greece once more faces the possibility of defaulting on its debts in the next few weeks, which could set off a chain reaction that jeopardizes its membership in Europe’s joint currency.
The country’s left-wing government has been locked in negotiations with its creditors and the institutions overseeing its bailout — the IMF, European Central Bank and European Commission — for the past three months over reforms required to unlock the remaining 7.2-billion-euro installment of its 240-billion-euro bailout.
With no other major external source of funding, Greece will not be able to continue meeting its debt repayments and pay for day-to-day spending without the rescue loans.
In Brussels, technical talks that started last week were extended beyond yesterday amid hopes for a breakthrough.
A eurozone official, who asked not to be identified because the negotiations were ongoing, confirmed that there was now visible progress after the talks had been bogged down for weeks.
