Greece to make April IMF pay­ment, but un­cer­tainty reigns

The China Post - - INTERNATIONAL - BY ODILE DU­PERRY

Greece is due to make its 459 mil­lion euro ( US$ 495 mil­lion) April loan pay­ment to the IMF Thurs­day fol­low­ing days of un­cer­tainty, but the Euro­pean na­tion’s abil­ity to honor its debts re­mains a source of acute anx­i­ety to cred­i­tors.

As Greek Prime Min­is­ter Alexis Tsipras launched a two-day charm of­fen­sive in Moscow on Wed­nes­day, the or­der for the pay­ment had al­ready reached the Bank of Greece, a source familiar with the de­tails told AFP.

Ad­di­tion­ally, in­ter­est pay­ments of just un­der 400 mil­lion eu­ros and the re­newal of 2.4 bil­lion eu­ros in six- and three-month trea­sury bonds due to ma­ture on April 14 and 17 were also as­sured, ac­cord­ing to the source.

It would be “im­pos­si­ble for Greece not to ser­vice its debts this month,” the source said.

But de­spite gov­ern­ment re­as­sur­ances and the rais­ing of 1.14 bil­lion eu­ros from the sale of six­month bonds on Wed­nes­day, mostly to do­mes­tic buy­ers, Greece re­mains in a pre­car­i­ous po­si­tion, shut out from in­ter­na­tional debt mar­kets and re­liant on short-term bonds for bor­row­ing.

Greek banks are de­pen­dent on the Euro­pean Cen­tral Bank for fi­nanc­ing, but the eu­ro­zone’s cen­tral bank no longer ac­cepts Greek sovereign bonds as col­lat­eral for loans.

IMF

chief

Christine La­garde said late Sun­day that Greek Fi­nance Min­is­ter Ya­nis Varo­ufakis had pledged to make the pay­ment on time in a meet­ing in Wash­ing­ton, but that failed to quell spec­u­la­tion that the hard-left gov­ern­ment was find­ing it in­creas­ingly dif­fi­cult to raise money to pay its debts.

Since 2010, Athens has re­ceived two suc­ces­sive loans from the EU and the IMF to­tal­ing 240 bil­lion eu­ros in ex­change for tough aus­ter­ity mea­sures and sweep­ing eco­nomic re­forms.

Tsipras’s gov­ern­ment, which took power in Jan­uary, has en­gaged in dif­fi­cult ne­go­ti­a­tions with Euro­pean lead­ers to con­tinue re­ceiv­ing sup­port while eas­ing the aus­ter­ity re­quire­ments in or­der to boost eco­nomic growth.

Ex­perts from the IMF and the Euro­pean Union are scru­ti­niz­ing a list of eco­nomic re­forms pro­posed by Athens in a bid to un­lock an­other 7.2 bil­lion eu­ros in loans to stave off pos­si­ble bank­ruptcy.

Tsipras him­self fu­eled mar­ket fears over Greece’s readi­ness to pay its debts when he warned Ger­man Chan­cel­lor An­gela Merkel in a let­ter last month that Athens would not be able to ser­vice its debt with­out more fi­nan­cial help from the Euro­pean Union.

And in a move that risks fur­ther ir­ri­tat­ing Euro­pean neigh­bors, Tsipras has made no se­cret of seek­ing closer ties to Rus­sia at a time when Moscow is at log­ger­heads with the Euro­pean Union over the con­flict in Ukraine.

AP

A man makes his way past var­i­ous goods for sale at a mar­ket street in Athens, on Thurs­day, April 9.

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