Greek Tragedy Of Impending Financial Ruin Enters Final Act

AP Photo
The Associated Press

Greece has managed to meet its debt repayments for this month – but only just. The financially-stricken nation has managed to find some fiscal breathing space but in a few weeks will be called on to meet further demands from the international community for repayments on previous loans.

According to the Daily Telegraph, Athens successfully honoured half of its monthly public sector wage, pension and social security bill on Friday. The Greek ministry of finance says the obligations are thought to be around €500bn.

The government, which has been without international aid since August, has resorted to desperate measures to continue paying its civil servants and pensioners. Foreign embassies and consulates are being forced to hand over any excess cash while municipal authorities across the country have been told to return any unspent funds.

Financial market analysts predict that despite ongoing belt tightening Greece may already be past the point of survival.

“Running out of money is a relative concept – there is no finite moment the government will run out of cash,” Justin Knight at UBS told the Telegraph.

“By many measures, Greece has already run out of money and could be on the verge of issuing IOUs as they were forced to do to the pharmaceutical sector in 2011.”

The governing Syriza party has long fallen into arrears with many of its government suppliers, and faces a €1.5bn repayment to the International Monetary Fund in just two weeks.

“No-one can say with certainty how much money Greece still has and the debt schedule for the next months is alarmingly heavy,” said Eirini Tsekeridou at Julius Baer.