+

Cookies on the Business Insider India website

Business Insider India has updated its Privacy and Cookie policy. We use cookies to ensure that we give you the better experience on our website. If you continue without changing your settings, we\'ll assume that you are happy to receive all cookies on the Business Insider India website. However, you can change your cookie setting at any time by clicking on our Cookie Policy at any time. You can also see our Privacy Policy.

Close
HomeQuizzoneWhatsappShare Flash Reads
 

Here's what happens next in Greece's debt drama

Feb 6, 2015, 15:18 IST

Greek prime minister Alexis Tsipras and finance minister Yanis Varoufakis are back in Athens after a European tour in an attempt to sell a debt restructuring deal. But the drama is not over.

Advertisement

On Thursday, Varoufakis visited Germany and invoked memories of the rise of Nazism, saying that his country was going through a period like the early-1930s in Germany.

On the minister's return, Greek leader Tsipras said the country "won't take orders anymore." He wants the bailout and austerity agreements made with the country's major international creditors scrapped, but hasn't won any major concessions yet.

So what happens next?

Well, Greece has potentially just weeks of cash left. The bailout, which the government depends on to fund itself, runs out at the end of February.

Advertisement

Varoufakis and the government are asking for a bridging loan from Europe while debt is negotiated: they want something just to tide them over for the next few months, with no strings attached.

The next Eurogroup meeting of the euro finance ministers was pushed ahead to Feb. 11 with Greece back at the top of the eurozone's list of problems, two-and-a-half years after the end of the euro crisis.

Oxford Economics' Gabriel Sterne expects that Athens will get a bridging loan, but that the "ultimate crunch point" will come in July and August when Greece has other major debt repayments to make. It's not clear what happens if there simply isn't support for a temporary loan this month, and other European countries decide to bring that crunch point ahead.

BNP Paribas has a useful timeline showing how pressure will build on Greece after the bailout funding ends. They'll have a lot of large bond payments to make:

Advertisement
You are subscribed to notifications!
Looks like you've blocked notifications!
Next Article