ATHENS: State borrowing from domestic sources, surged a projected level by 40 percent or €31.8 billion in the 1st Quarter. This reflects the complete derailment of the state budget and the state’s lack of liquidity as it scrambles to pay its debts inside and outside the country.
The data on the execution of the state budget are revealing, as they show that tax revenues slumped €748 million in the first quarter of 2015, while in terms of expenditure the state has simply ceased making payments, lagging projections by €1.5 billion.
In the year to the end of March the state has proceeded to short-term borrowing (repos) from general government entities amounting to €111.8 billion, while the budget had provided for no more than €80 billion for the entire year.
The lack of liquidity, owing to the non-payment of the last bailout installment and the country’s inability to access the markets, would have led any government to domestic borrowing through repos. That is why the budget had provided for repos of €80 billion, which does not amount to net borrowing of €80 billion but rather to repeated 15-day loan rollovers.
