By Fiona Mullen, director of consulting company Sapient Economics, both for Athens and their creditors would have preferred if, instead of sudden collapse, which in the current situation is becoming increasingly possible, agreed among the “orderly + Grexit + (exit from the euro zone) “.
” Everyone says that they do not want Greece left the euro zone, but dragging this difficult situation can cause more harm than good “- PAP said Mullen. She recalled that Athens will most likely go bankrupt already 30 June, when it will pay 1.6 billion International Monetary Fund (IMF).
According to Mullen theoretically still possible that within the next 36 hours, all callers will return to the negotiating table, someone “pull a rabbit out of a hat”, Greece repay the IMF, and the Greeks will vote in a referendum on July 5 by agreement with the creditors. Such a scenario is far from improbable, and in addition would not solve all the problems of Greece.
“The Greek crisis is a real vicious circle. We need to finally break out of it “- says Mullen. He explains that although “Grexit” is actually unavoidable, it can be done as either pleasant or unpleasant. She recommends this first, which would mean cooperation between the Eurogroup and Greece on reducing the impact of the crash. Mullen turns in a control movement of capital and financial support for the Greek balance of payments would stop new Greek currency from a rapid decline in value.
Mullen also dorzuciłaby to leave for Athens gate open in case the economic situation of Greece has improved enough that she could re-join the eurozone. “The Eurogroup would then have the opportunity to demonstrate some of these European values, which rarely we have witnessed during the recent negotiations”, – says Mullen. He adds that the Sunday closing of Greek banks and the introduction of capital flow control reminds her of the banking crisis in Cyprus in 2013. It is suspected that the Greek story will take a lot longer and have worse mileage. (In Cyprus, the closure of banks was the result of an agreement with the government’s “troika” of lenders (EC, ECB, and IMF) and the control of capital movements was completed only in April this year.)
Mullen believes, however, that because Greece withdrawing money from banks had already lasted from January (when he came to power the Radical Left Coalition, or Syriza) in the country is at the moment a lot of cash concealed under the mattress so at least some Greeks so soon run out of money.
Constantin Papapdopulos, a former banker and adviser. economical George Papandreou’s government also believes that there is a great danger that Greece will go bankrupt on Tuesday. If, in addition during the referendum, the Greeks reject the agreement with creditors, banks will remain closed for a long period of time because only in this way will be able to avoid bankruptcy. Then the whole Greek economy will be frozen; nobody will be able to carry out business transactions and those who will have the cash they do not want her to spend on anything else but food.
“All the shops pozamykają to be just food,” – says Papadopoulos. Now – adds – foreign travel agencies are beginning to cancel bookings they have made for themselves just starting the summer season, which was to bring Greece’s record profit.
According to Papadopoulos a more optimistic scenario, in which the Greeks accept the bailout money lenders or not is good, because the return to negotiations and to develop a new agreement covering the consequences later, caused stagnation last few months of the recession, will cause it will not be the same package.
“I have no idea what will be the result of such changes, and and then the government, which now does not behave reliably, it will accept. This may mean further complications, “- says Papadopoulos.
On Sunday, Greek Prime Minister Alexis Cipras said in a televised address to the nation that Greece introduces temporary closure of national banks and capital flow control.
Authorities Greek has recommended to ATMs throughout the country were closed on Mondays and Tuesdays payments were limited to 60 euros a day. Banks will be closed until next Monday.
The limit daily withdrawals will apply to holders of cards issued by Greek banks. Holders of cards issued by foreign banks will be able to pay the money to the limit set by these banks.
The decision to close the banks was the result of Sunday’s freezing by the European Central Bank (ECB) emergency loans to Greek banks at approx. 90 billion euro.
Greek banks were doomed for months financial support of the ECB.
Their situation has gradually deteriorated due to the fact that more and more customers, in response to the progressive crisis began to withdraw all of their savings accounts.
However, the ECB was still ready to finance banks until Saturday when the finance ministers of the euro zone, without the participation of the Greek Minister, decided that an aid program for Greece, which expires on June 30, but will not be extended.
The government in Athens courted that the aid scheme has been extended in order to gain time for the referendum to be held on July 5 on the conditions for support set by lenders. However, this request was rejected.
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