Greece is currently suffering through one of the direst economic crises of any industrialized nation in history. Now, the nation finds itself at the heart of a policy struggle between Eurozone lenders and the International Monetary Fund (IMF) over debt reductions prior to additional bailout funding. This has led to the IMF’s revision of its long-term projections for the embattled nation.
For investors, the most important thing about the successful review of Greece’s implementation of last year’s agreement is that it effectively removes it from the list of potential disruptive factors in the coming quarters. There will be no repeat of last year’s drama.
Assuming Greece resolves a few outstanding issues in the next few days, it will be given roughly 7.5 bln euros next month and another three bln euros over the summer. The funds will be in Greece’s hands for the shortest of periods.
The International Monetary Fund (IMF) spent the weekend trying to smooth tensions with Greece following the release of a transcript of leaked phone calls between IMF officials. The head of the International Monetary Fund, Christine Lagarde, took personal notice of the matter and attempted to smooth tensions with Greece Sunday after Greek officials raised questions about whether it can obtain further funding as part of its $98 billion bailout.
European lenders and the International Monetary Fund (IMF) appear to have strong disagreements over how best to handle the Greek financial crisis. Because of those disagreements, Greece may suffer as new payouts and further debt relief talks are delayed while third parties clash over the details.
Greek Prime Minister Alexis Tsipras has condemned the International Monetary Fund’s (IMF) recent behavior in dealing with the European Nation’s lingering financial woes. Tsipras accused the IMF of inconsistency with regard to whether it wanted to stay with a bailout program, and described its conduct as nonconstructive.
While most economic news originating from Greece has been negative over the last few years, a small glimmer of good news appeared this week. According to a new study by the Organization for Economic Coopertion and Development (OECD), Greek pensioners receive the equivalent of 98 percent of their average income, putting them at third highest among OECD’s 34 member countries.
Defying the expectations a few months ago, Greece remained in the Economic and Monetary Union. It recently succeeded in implementing sufficient reforms to earn another tranche of aid. However, the entire exercise exhausted whatever trust there may have been. It has also further soured Greece’s attitude toward the EU. This leaves officials ill prepared to deal with other issues.
Greece remains in a precarious financial situation years after the global economic recession rocked its economy. As a result, Greece is currently working to obtain an additional two billion euro bailout to help keep its government and public services running. However, the Organization for Economic Cooperation and Development (OECD) has warned that without making systemic changes to the nation’s tax collection efforts, these funds could be lost and leave the nation without the means to repay.
As a lightning rod for the global capital markets, Greece has surrendered. It role being taken up by China rough transition or the Fed’s continued reluctance to hike rates six years since the recession ended and despite the achieving of unemployment levels rarely seen.
Syriza’s victory in the Greek snap election is remarkable. After all, it followed a catastrophic seven months in power that saw Greece almost exit the euro, the Greek economy plunge back into recession, the imposition of capital controls following a practically meaningless and divisive referendum, and the signing of a third bailout programme last August – which effectively contradicted the platform on which Syriza initially came to power.
