Wrangling over Bailout Continues as Greeces Inches Toward Default
Nov 20th 2012 7:11AM
After months of wrangling, disagreement and partial compromise, Greece does not have the money it needs to avoid default. The Greek government claims it has gone along with all the austerity requests of the European Union, International Monetary Fund and European Central Bank. The IMF and ECB recently went head to head on how long Greece should have to gain partial control of its finances. Creditors continue to fight as they worry they will be asked to take more write-downs, on top of those they took less than six months ago.
Euro zone finance ministers are likely to give tentative approval for the next tranche of loans to Greece on Tuesday although the money is unlikely to be disbursed before December and a deal on debt reduction may also require further talks.
Officials familiar with preparations for the finance ministers' meeting expect a "political endorsement in principle" on unfreezing loans to Athens, after Greece completed almost all the reforms that were required of it in exchange for funding.
The final go-ahead from the ministers is likely to come only once the remaining few Greek reforms are in place and once there is agreement in the euro zone on how to reduce the country's huge debt and secure extra financing while it is being done.
Douglas A. McIntyre
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