As per a pro-government newspaper in Greece, in the first tranche of its bailout package, Greece is likely to request 24 billion euros to its international creditors sometime this August. With this monies in hand, it will be in a position to repay its debts to the European Central Bank (ECB).
Further, it is also in talks with the International Monetary Fund (IMF) and the European Commission in order to secure around 86 billion euros as a bailout aid. This will be its third bailout package since 2010. Going by reports emanating out of the Avgi newspapers, which has close links to the leftists Syriza government, Greece is expected to conclude talks with its creditors by mid-August.
It plans on utilising the first tranche of its 24.36 billion by re-capitalizing its nationalised banks by channelling 10 billion euros into them, 7.16 billion euros will go towards repaying an emergency bridge loan, while 3.2 billion euros would be spent towards repaying the Greek bonds held by the European Central Bank (ECB). The remaining 4 billion will be utilized for other payments said Avgi.
With investors having withdrawn their deposits due to the earlier stalemate which had threatened Greek’s exit from the European Union, as per initial estimates, as much as 25 billion euros may have to be funnelled into the coffers of Greek Banks so as to stabilise their operations.
Earlier, the outflow of funds from the country was so heavy that Greek authorities were left with no option but to impose capital controls on the 29th of June 2015, so as to avert a financial meltdown.
In order to streamline, stabilise and revitalise the financial system Greece had very little option but to accept much needed financial reforms, which include, amongst others, increasing Value Added Taxes (VAT), significant reforms in its pensions, measures to open up and liberalise its economy as well as overhaul its collective bargaining system.
It is crucial that the talks go as per schedule and are completed in time, failing which Greece may have to again approach its European creditors for a bridge loan, as it did in July. However, as per Avgi, this scenario has not come up for discussion with the European Authorities.
Source(s): Reuters.com
Further, it is also in talks with the International Monetary Fund (IMF) and the European Commission in order to secure around 86 billion euros as a bailout aid. This will be its third bailout package since 2010. Going by reports emanating out of the Avgi newspapers, which has close links to the leftists Syriza government, Greece is expected to conclude talks with its creditors by mid-August.
It plans on utilising the first tranche of its 24.36 billion by re-capitalizing its nationalised banks by channelling 10 billion euros into them, 7.16 billion euros will go towards repaying an emergency bridge loan, while 3.2 billion euros would be spent towards repaying the Greek bonds held by the European Central Bank (ECB). The remaining 4 billion will be utilized for other payments said Avgi.
With investors having withdrawn their deposits due to the earlier stalemate which had threatened Greek’s exit from the European Union, as per initial estimates, as much as 25 billion euros may have to be funnelled into the coffers of Greek Banks so as to stabilise their operations.
Earlier, the outflow of funds from the country was so heavy that Greek authorities were left with no option but to impose capital controls on the 29th of June 2015, so as to avert a financial meltdown.
In order to streamline, stabilise and revitalise the financial system Greece had very little option but to accept much needed financial reforms, which include, amongst others, increasing Value Added Taxes (VAT), significant reforms in its pensions, measures to open up and liberalise its economy as well as overhaul its collective bargaining system.
It is crucial that the talks go as per schedule and are completed in time, failing which Greece may have to again approach its European creditors for a bridge loan, as it did in July. However, as per Avgi, this scenario has not come up for discussion with the European Authorities.
Source(s): Reuters.com