On Sunday, Greece’s interior minister sent the strongest warning yet that the government in Athens will be unable to meet a 1.6 billion euros (Dh5.2 billion) payment due to the International Monetary fund (IMF) on June 5. Speaking on Greek television, Nikos Voutis’ warning that unless Athens received the latest tranche of 7.2 billion euros due under the terms of the two bailouts totalling 240 billion euros granted by the so-called ‘troika’ of the IMF, the European Union (EU) and the European Central Bank (ECB), Athens would fail to make the June 5 payment.
The IMF payment comes just after Athens must make monthly salary payments to its public sector workers and make welfare payments to those on benefits. What the troika now must decide is judge whether the government of Alexis Tsipras, elected in January to reject austerity terms, is actually serious about now being able to pay, or is it just another negotiating ploy from the socialists. Already, the Athens government has failed to provided enough assurances and detailed plans about its savings and budgetary needs, leaving the troika with little room to manoeuvre. And at the same time, Athens engaged on a verbal offensive against Germany, viewed in Greece and across austerity-inflicted nations as being the culprit behind more stringent fiscal conditions.
The fact that the announcement was made by Voutis, rather than one of the Cabinet ministers holding a portfolio with direct control over the nation’s finances, may be viewed by the troika as a sign of political bluff. Certainly, the IMF will be unimpressed with the claim of inability to pay by June 5. But the political leaders across the 28-nation EU and the 17-nation common currency zone will be looking at Voutis’ statement that the clock is ticking. Yes, the payment to the IMF is scheduled by June 5 — the reality though is that Athens will still have 30 days to find the cash for the IMF. That 30-day window may just be the last chance that all involved in this standoff will get to reach a final political and monetary settlement. After that, it will hit the fan.
