reek voters take to the polls today to decide whether to accept or reject a set of measures proposed by Greece’s creditors before the creditors will be willing to extend another bailout to the essentially bankrupt country. Greece defaulted on a €1.5 billion (R20.4 billion) International Monetary Fund (IMF) repayment on Tuesday, and other creditors are waiting in the wings.
Two yen-denominated bonds are due to mature on Tuesday, according to Bloomberg data, and the Financial Times reports that the country has debt repayments of €18.7 billion remaining this year.
Daniel Solomon, an economist at market research firm Euromonitor International, said: “I think the probability of a comprehensive default, as opposed to just defaulting on the IMF payment, is around 50%.”
An immediate bailout hinges on the results of today’s referendum, which Prime Minister Alexis Tsipras called on June 26 amid a deadlock with creditors.
According to Nedbank economist Isaac Matshego, if Greek voters reject creditors’ proposals – which include cutting high state-pension payments, a move Tsipras’ leftist government does not want – this would be seen as a rejection of the euro monetary union. This would have ripple effects for financial markets, most significantly for emerging market currencies such as South Africa’s.
Here is how economists think Greeks will vote, and how it will affect South Africa.