Mumbai: Tuesday, June 30 will be an important date on our calendar. At present, Greece needs additional financial aid to prevent it from defaulting on its £1.6 billion debt to the IMF and the lenders are not willing to lend more until the Greek government carries out credible reforms.
The issues that still remain unsettled are the labour laws, collective bargaining, pension reform, and public sector wages, opening up of closed professions, investments as well as VAT and corporate income-tax.
The international creditors have rejected the Greek government’s plan to prevent financial crisis and release funds without implementation of these additional reforms. Alternatively, they have submitted counter proposals.
In the meetings and discussions of Greece’s Prime Minster with the heads of the European Commission, the IMF, the ECB and euro zone finance ministers, there has been no consensus reached so far.
Ahead of the Greek bail-out expiry on June 30, the European leaders are due to conduct a two day summit in Brussels starting 25th June 2015, which could go to the 27th. In a research paper on the Greek crisis Care Ratings chief economist Madan Sabnavis said, “A default can lead to an exit of Greece from the euro system, but even as it sounds logical, the ramifications are many as European banks have lent heavily to this country.” Besides, it will also create a stir in similarly placed countries which are larger in size than Greece. Therefore, the finale of this story as it unwinds towards the end of the month is critical globally.
