Can I borrow 44 Billion more Euros please?

Greece is likely to receive 44 Billion more euros in emergency loans from the IMF (International Monetary Fund). This tranche is likely to be payed out just two days after the December 3rd Eurogroup meeting.

Tuesday, at the November 20th Eurogroup meetings, euro zone finance ministers may release a tentative approval of Greece’s emergency loans.

Greece is required commit to a package of economic reforms. It is called “prior actions”.

These prior actions could be watched by the international lenders to make sure Greece is in position to receive the next tranche.

A senior euro zone official was asked about Greece completing their steps up to this point and said: “They have done so, and two small items remain to be done before disbursement.” (Reuters)

Yannis Stournaras the Greek Finance Minister, declined to comment Sunday when asked if the tranche would be approved tomorrow.

On the other hand Jean-Claude Juncker, the Luxembourg Prime Minister predicted a “definite decision” last week concerning the release of more aid to Greece. (Bloomberg)

Interesting enough, it was Jean-Claude Junker who said, concerning last Monday’s euro zone meetings that he did not anticipate a “definite” decision to be made. With Tuesday’s meeting, his outlook has obviously shifted. That news gives us a good chance that an influential annoucement could be released tomorrow. Volatility is likely if the new tranche does get scheduled to be released in December.

Greece owes hundreds of billions of euros to the troika, Greece appears to only take from the Euro zone and not contribute. This could possibly lead to a future Greek exit. A Greek exit has been talked about for numerous months. Eventually, if Greek heads down their current direction, I would think the Euro zone leaders may have to make that hard “exiting” decision.

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  • Ian D Edwards

    Economics and Society are things progressive politicians try and control instead of enabling and one politician’s failure is another’s victory, I spoke to a Greek tonight just over here on a visit who believes ‘they’ have already decided what they want to do but need the right political ‘moment’ to do it so it looks like a success call. They will be dammed which ever way they go so will delay as long as possible on the basis that if you wait long enough problems sometimes go away – or at least it’s passed on to the next incumbent – and they may get away with reputation intact, the third thing they are always seeking to control.

  • Interesting outlook Ian. One thing about it is, it’s hard to put a time line on events. For example: when will Greek exit? The euro zone has invested so much cash trying to bail them out, I wonder when they will let them go.

  • Ian D Edwards

    The Greeks can’t control their own currency – as they don’t have one, they have the Euro. When they exit, with all that bailout debt, the terms will be interesting. I imagine the Greeks will print (inflate) their new Drachma (or whatever) currency and then pay back the loan in Drachmas. That will make Greece back to what it was before it entered into the Euro. Everyone happy – but no more ‘taking’ for nothing in return which is just a shrug of the shoulders really for the average man in the street. The Euro will wobble for a few days then people will realise Greece was too small to even matter. Then everyone will worry about Spain, Portugal and Italy, who will put a dent in the Euro. The question is will the US of E survive.