ATHENS: Greece has refused to make a €305m repayment due to the International Monetary Fund (IMF) on Friday as part of its bail-out deal.
According to IMF protocol, even after June 30, Greece would be afforded a 30-day grace period before Christine Lagarde, the head of the IMF, takes action. A month after this, a technical default could be declared when “a complaint regarding the member’s overdue obligations is issued by the Managing Director to the Executive Board”.
If Greece does default, it would be the first advanced economy to do so, and would join countries like Peru, Sudan, Liberia and Somalia. It would be denied access to fresh IMF financing, and would lose its credibility in the market. Zambia has also been in arrears to the IMF.