Greek debts: what does it owe? When will the money run out?

originally published at the Guardian by Katie Allen Friday 24 April

Greece owes money to the International Monetary Fund, the European Central Bank and the European Union following its two bailouts in 2010 and 2012

Greece faces a busy schedule of debt deadlines as well as payments due on salaries and pensions.
Warnings are growing that Greece could crash out of the eurozone as it battles a busy schedule of debt deadlines as well as payments due on salaries and pensions.

Photograph: ALKIS KONSTANTINIDIS/REUTERS

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Crunch talks between Greece and its eurozone creditors are under way, but investors are growing increasingly sceptical that the country can reach an agreement on reforms and unlock the aid it needs from international lenders to avoid a debt default.

Greece owes money to the International Monetary Fund, the European Central Bank and the European Union following its two bailouts in 2010 and 2012. Athens is waiting for a further €7.2bn (£5.2bn) in rescue funds and without that money it is unlikely the country can pay almost €1bn due to the IMF in early May. Fears are growing that Greece will therefore default, precipitating the country’s exit from the eurozone.

Here we look at the near-term debt deadlines for Greece and what money it has left to meet them. We also consider how quickly funds have been flowing out of Greek banks.

The current disagreements with our partners are not unbridgeable – we should map out a forward-looking plan for Greece that avoids the ‘austerity trap’ and the ‘reform trap’

This covers repayments and the largest interest payments on debt due from Greece in coming months. The list includes Treasury bills, usually called T-bills for short, which are shorter-dated government bonds sold to domestic investors, such as Greek banks, and to a smaller extent to foreign investors. Greece has previously managed to convince bondholders to roll over their T-bill holdings, but with the country’s position growing more uncertain this pattern will become harder to maintain.

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What is left?
On top of debt repayments and interest payments, Greece has to cover the usual costs of pensions and salaries for the public sector. Salary and pension payments due in late April are thought to come to around €1.7bn.

There have been warnings that Greece faces a choice between meeting those commitments and its debt servicing – and that it cannot afford both unless the next lot of bailout funds is paid out.

Unnamed finance ministry officials in Greece have tolds Reuters news service that Greece will need to tap all the remaining cash reserves across its public sector, a total of €2bn, to pay wages and pensions at the end of the month. But at the same time, and without providing any figures, Greece’s finance ministry denied in a statement that it would need to tap remaining cash reserves to meet salary payments.

Economists say some scepticism should apply to any claims the coffers are almost empty.

Paolo Pizzoli , senior economist at ING in Milan comments:

The Greek government has tried to squeeze money out of a variety of sources for a couple of months now.

Capital expenditure has reportedly been trimmed, state payments to third parties have been postponed and reserve funds of public institutions tapped, but with scarce chances to get the relevant data evidence.

Furthermore, the ‘running out of funds’ rhetoric has often been used instrumentally to affect negotiations by parties involved, adding to the noise.

Bottom line, we, or at least I, don’t now how much money the country has now available, but I suspect that there is not much left in the coffers.

Zsolt Darvas at the thinktank Bruegel also urges caution about any warnings that Greece is about to run out of cash. He notes that Greece has financial assets it can fall back on. The most up-to-date data, from September 2014, showed the Greek government had assets worth €86.6bn. Darvas adds:

Even if the €86.6bn has declined by a dozen or two, and even if not all of the remaining assets could be easily used to pay for obligations, there is still a lot, and much more than the €30bn assets the Greek general government had at the end of 1997 (see chart below).”

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Darvas at Bruegel also notes asset holdings in Greece are “relatively high” by comparison with other European countries. As a share of financial assets in GDP, Greece ranked seventh among the 28 EU countries in September 2014, as shown here:

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What is happening at Greek banks?
Growing uncertainty about Greece’s position in the eurozone and fears of rising political instability have prompted savers to take their money out of Greek banks and instead keep it at home or move it overseas.

Banks suffered deposit outflows of some €25bn between December and February, according to the latest figures. The capital flight continued in March but the pace slowed somewhat with net withdrawals at €3bn, according to a report by news service Bloomberg.

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Gabriel Sterne at the consultancy Oxford Economics comments:

The big surprise, if anything, is it still remains more of a bank jog than a bank run. It wouldn’t take much, however, for confidence to go and the run to accelerate.”

Given deposits are the basic source of funding for banks, their depletion is seen representing a significant risk for the Greek financial system. So far, the European Central Bank (ECB) has been prepeared to step in and fill the funding gap for Greek banks by increasing the cap on emergency liquidity assistance (ELA). However, as the name the implies, this was never intended to be a long-term measure to keep a eurozone country afloat.

Sterne warns that capital controls, whereby limits are placed on what savers can withdraw from banks, could be around the corner for Greece:

One more turn of the financial screw and Greece would be in capital controls; a terrible symptom of political failure of a six-year attempt to restore sustainability.”

Diego Iscaro, senior economist, at the consultancy IHS says the ECB’s role is crucial. He believes the risk of Greece leaving the eurozone is “increasing by the day”. Iscaro adds:

The key will be held by the position taken by the ECB: a withdrawal of its support to the Greek banking sector resulting from a sovereign default could be the trigger that decides Greece’s fate in the eurozone.”

Migrant boat crisis: the story of the Greek hero on the beach

published at The Guardian 

One compelling image has come to represent all the Greek people who treated desperate migrants like fellow human beings

Boat migrant being rescued

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Antonis Deligiorgis saving Wegasi Nebiat: ‘I was having trouble lifting her out of the sea, then instinctively, I put her over my shoulder.’ Photograph: Argiris Mantikos/AP

by Helena Smith in Athens on Sunday 26 April

It was an image that came to symbolise desperation and valour: the desperation of those who will take on the sea – and the men who ferry human cargo across it – to flee the ills that cannot keep them in their own countries. And the valour of those on Europe’s southern shores who rush to save them when tragedy strikes.

Last week on the island of Rhodes, war, repression, dictatorship in distant Eritrea were far from the mind of army sergeant Antonis Deligiorgis. The world inhabited by Wegasi Nebiat, a 24-year-old Eritrean in the cabin of a yacht sailing towards the isle, was still far away. Continue reading

Out of the Box Intermedia presents “Comrades of Time” by Andrea Geyer at the Refrains of Freedom International Conference

24 & 25 April 2015

Opening: 24 April, 7.30-9.30pm

French Institute Athens free event

31 Sina st, 10680

and 25 April, 7.30-11pm by invitation only

Museum of History of the University of Athens

5 Tholou st, 10556

http://www.outoftheboxintermedia.org

The Non Profit Art Company “Out of the Box Intermedia” presents “Comrades of Time” by Andrea Geyer curated by Dr Sozita Goudouna within the context of the Gilles Deleuze and Félix Guattari: Refrains of Freedom International Conference” on Friday 24th of April at 17.30-19.30pm at the French Institute of Athens and on Saturday 7.30-11.00pm at the Museum of History of the University of Athens, (Old University, or Oikia Kleanthous)

Andrea Geyer_Comrades of Time_7 monologues

Comrades of Time attempts to find new ways to capture time in the image by engaging with the question of time and with the provocation of Gilles Deleuze’s term the “Time-Image.” The artist is researching on the new significance of time and on the temporalization of the image as a political, historical and cultural construct by working with seven women who recite monologues composed from speeches, letters and essays from 1916-1941, written by architects, writers, philosophers and political organizers from the vibrant years of the Weimar Republic as a kind of cultural echo: an experience of historical times as they are brought to the present.

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Continue reading

A very European coup

by COSTAS DOUZINAS 24 April 2015 published at http://www.opendemocracy.net
This is why Syriza’s negotiating strategy has to play to the European gallery and not just to the suits in the conference room. The aim is to persuade people to put pressure on their own governments or change them in the coming elections.
Alexis Tsipras greets supporters in Berlin before a meeting with Angela Merkel. Demotix/Florian Boillot. All rights reserved.
The novel A Very British Coup was written by the Labour MP Chris Mullin in 1982. Inspired by Tony Benn’s candidacy to become Deputy Leader, it tells the story of Harry Perkins, a working class, left-wing leader of the party, winning the 1991 elections. The Labour manifesto promises to break up media monopolies, withdraw from NATO and the EU, remove American military bases, abolish the House of Lords and public schools and introduce true open government.

To avoid the conditions of the IMF, the government agrees a loan with the Soviet Union. The fearful establishment organizes an elaborate conspiracy. Media magnates, top civil servants, the financial world, the MI5 and the CIA conspire to stop the government. The stock market and the pound fall dramatically, firms close factories and relocate overseas, a bank run is orchestrated. Extramarital affairs and youthful misdemeanors are plastered all over the papers. Eventually after an accident in a nuclear plant, probably engineered by the conspirators, the government resigns. Continue reading

A New Deal for Greece – a Project Syndicate Op-Ed

Originally posted on Yanis Varoufakis:

Photo of Yanis VaroufakisFor the Project Syndicate page click here.

ATHENS – Three months of negotiations between the Greek government and our European and international partners have brought about much convergence on the steps needed to overcome years of economic crisis and to bring about sustained recovery in Greece. But they have not yet produced a deal. Why? What steps are needed to produce a viable, mutually agreed reform agenda?

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The Extreme Centre: A Warning

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by Tariq Ali
Britain’s leading radical delivers an eviscerating attack on the indistinguishable political elite of the UK.

What is the point of elections? The result is always the same: a victory for the Extreme Centre. Since 1989, politics has become a contest to see who can best serve the needs of the market, a competition now fringed by unstable populist movements. The same catastrophe has taken place in the US, Britain, Continental Europe and Australia.

In this urgent and wide-ranging case for the prosecution, Tariq Ali looks at the people and the events that have informed this moment of political suicide: corruption in Westminster; the failures of the EU and NATO; the soft power of the American Empire that dominates the world stage uncontested.

Despite this inertia, Ali goes in search of alternative futures, finding promise in the Bolivarian revolutions of Latin America and at the edges of Europe. Emerging parties in Scotland, Greece and Spain, formed out of the 2008 crisis, are offering new hope for democracy.