While Greece is gradually entering the election campaign period in full force, the political parties seem to be unfazed by the warnings issued by the European Union and International Monetary Fund over possible delays and the ensuing repercussions.
The IMF’s Poul Thomsen has already informed the Fund’s board that the upcoming elections will stall the review, while the head of the Eurogroup Jeroen Dijsselbloem has expressed his concern over the implementation of prior actions for the 3-billion-euro tranche, to the point where Greece will be on the top of the Eurogroup agenda on the 11th and 12th of September.
Should the recapitalization of the banks not conclude by the end of the year, Greece may soon find itself with its back against the wall. This is because as of 2016, the EU bail-in regulation comes into effect, meaning that a haircut of bank deposits may take place. Additionally, without the bailout funding, Greece will be unable to pay 1.63 billion euros towards IMF in December and January.
Aside from these two major concerns though, Greece’s international creditors will return to Athens in the fall to discuss a series of crucial issues that still remain unresolved, such as the pension reforms, home foreclosures, non-performing (“red”) loans, the implementation of the OECD toolkit, privatizations and more.
