Big day for Greece tomorrow -- the first of many ? It's hard to hear the call for compromise above the din of sabres being rattled.

Monday 11th May 2015

 
Big day for Greece tomorrow  --  the first of many ? It's hard to hear the call for compromise above the din of sabres being rattled.

"Q & A  All eyes on Athens as 750m euro repayment is due" , The Financial Times, p.7

 and

"Greek "war cabinet" set to battle EU creditors" , The Daily Telegraph, p. B1

SITUATION REPORT : With Greece due to repay 750m euros to the IMF tomorrow, Eurozone ministers meet in Brussels today to discuss once again whether to release a further 7.2b euros of the bailout programme. Whilst the release of these funds is deemed to be crucial, such a sum would not in itself be enough to cover Greece's repayment schedule over the next few months, a handy summary of which is provided by the FT.

For the outsider at least, there's little sign of the two sides getting any closer. The IMF is intransigent about the both timing and amount of repayment, and both they and Greece's other main creditors (the ECB and the EU) remain equally firm over the hoops they require Greece to jump through in order to release the funds.

As for Greece, rather than move towards their creditors' position she seems to headed in the other direction, according to the Daily Telegraph. At a nine hour cabinet meeting yesterday, ministers reaffirmed their determination not to give in to further compromise and to stick to their anti-austerity election promises. One source suggested that Greece could cover tomorrow's repayment but have nothing left to honour the many further commitments. For some in Athens there is a sense of inevitability about the future and the case is being made that to continue to struggle to make one repayment after another (under what some view as impossible terms and conditions) is just digging themselves further into a hole that ultimately they have no chance of escaping. Sadly, it's a view that has some logic to it.

This whole saga has been like watching an advancing train crash in slow motion. Everyone can see it is coming but they lack either the power or the desire to do anything about it. The situation has been critical for a long time but we are now approaching a denouement, and it doesn't look pretty.