Wednesday, June 17, 2015

Greek Debt Crisis: Key Dates on the Road to a Possible Grexit

FT has put together a timeline:

Thursday June 18: Best chance for a deal

Eurozone finance ministers gathering in Luxembourg for their regularly scheduled monthly hope a deal can be struck.

Friday June 19: The morning after

Finance ministers will still be in Luxembourg for a second day of meetings, this time with all 28 countries in attendance. In theory all the actors who need to strike a deal will be in the same place at the same time. But unless there is a drastic change in circumstances — a sudden market panic, for instance, or long lines forming at Greek banks no deal on Thursday means there would be little to discuss on Friday.

Sunday June 21: Possible emergency summit

Some officials believe a eurozone summit would be redundant if no deal is reached among finance ministers, since it is those finance ministries that are best equipped to negotiate the substance of any bailout agreement. But other eurozone officials believe Alexis Tsipras, Greek prime minister, wants to strike a deal.

June 22 onward: Worst-case scenarios

If no agreement can be reached, worst-case scenarios begin to kick in, including capital controls to limit withdrawals from Greek banks and prevent a complete financial meltdown.

June 25: Any other business

This is the date for the beginning of a long-scheduled EU summit. But Eurozone officials increasingly believe that by this point it will be too late to salvage a Greek deal.

June 30: Expiration date

The date Greece’s current bailout expires and when it is due to repay €1.5bn in loan repayments to the International Monetary Fund. Without an agreement on a list of economic reforms, officials have said there is no hope of extending the program for a third time.

July 1: Uncharted territory

If the bailout expires and Greece fails to make the IMF payment — but the ECB decides emergency loans to Greek banks can continue — Greece enters what Mario Draghi, ECB president, recently called “uncharted territory”. An economy hamstrung by capital controls, a government without any cash and a banking system struggling on life support, Greece would essentially begin a drawn-out process of economic suffocation.

July 20: Drop-dead deadline

This may be the real drop-dead deadline: the date two bonds totalling €3.5bn fall due to the ECB.

(via FT)

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