Thursday

6th Aug 2020

Greece risks default in mid-May, S&P warns

  • Greece faces insolvency next month, Standard & Poor's said Wednesday (Photo: Travel Aficionado)

Greece will be forced to default on its debts if a deal with its EU creditors is not reached by mid-May, a leading credit rating agency said on Wednesday (15 April).

Standard & Poor's downgraded Greece’s further into junk territory, from B- to CCC+, with a negative outlook, stating that “without deep economic reform or further relief, we expect Greece's debt and other financial commitments will be unsustainable".

Read and decide

Join EUobserver today

Support quality EU news

Get instant access to all articles — and 20 years of archives. 14-day free trial.

... or subscribe as a group

“If the stalemate between Greece and its official lenders is not resolved before the middle of May, there might not be enough time for the Greek parliament to enact whatever conditions are attached to a revised lending programme,” it added.

The stark warning piles more pressure on Alexis Tsipras’ government to come forward with economic reform plans and a timetable to implement what remains of its bailout plan.

Two months after Tsipras’ left-wing Syriza party was elected on a platform of ending the country’s austerity programme, his government remains at loggerheads with its EU creditors.

Despite Greece presenting a revised economic reform plan at the start of April, its EU creditors have demanded a detailed package of reforms before any further aid is released - €7.2 billion remains in Greece’s bailout plan.

Eurozone ministers will next meet in Riga next Friday, but recent days have seen several ministers play down the prospect of an agreement being reached.

“Given we have lost a lot of time, I am sceptical,” Slovak finance minister Peter Kazimir told reporters after a cabinet meeting on Wednesday.

“Greece is moving ever closer to the abyss”, he added.

A spokeswoman for the German finance ministry warned that “if people are under the impression that aid could be paid out in April, I think this is wrong."

"If there is a reform list, then the next step is a so-called Staff Level Agreement to make formal changes to the conditions of the aid program. This is a complex process and no one in the Eurogroup expects this to be concluded by April 24," she said.

For his part, German finance minister Wolfgang Schaueble, who is attending the International Monetary Fund's annual meeting in Washington, reiterated that “the key to the solution lies in Athens not anywhere else”.

He also indicated that the eurozone would be able to cope with a Greek default or exit from the eurozone, telling reporters that “you can’t see any contagion in markets”.

Time running out for Greece, warns euro commissioner

Time is running out for Greece to broker a compromise that will allow it unlock the remaining €7.2 billion in its EU-IMF bailout needed to avoid a default, the bloc’s eurozone commissioner has said.

Schaeuble and Varoufakis: worlds apart

Washington got a snapshot of eurozone politics when the two protagonists in the Greek impasse voiced opposing world views at a think tank event on Thursday.

Stakeholder

Renew Europe has a plan to combat gender-violence

This is not about supposedly traditional values – when was violence against women ever a value? – it is about living up to the European values we all signed up to. We have to put pressure on Poland.

Stakeholders' Highlights

  1. UNESDANext generation Europe should be green and circular
  2. Nordic Council of MinistersNEW REPORT: Eight in ten people are concerned about climate change
  3. UNESDAHow reducing sugar and calories in soft drinks makes the healthier choice the easy choice
  4. Nordic Council of MinistersGreen energy to power Nordic start after Covid-19
  5. European Sustainable Energy WeekThis year’s EU Sustainable Energy Week (EUSEW) will be held digitally!
  6. Nordic Council of MinistersNordic states are fighting to protect gender equality during corona crisis

Latest News

  1. Rainbow flag protesters charged by Polish police
  2. An open letter to the EPP on end of Hungary's press freedom
  3. Renew Europe has a plan to combat gender-violence
  4. Why EU beats US on green pandemic recovery
  5. Azerbaijan ambassador to EU shared anti-George Floyd post
  6. Polish party roars back at EU on LGBTI fines
  7. EU: Hong Kong election delay undermines democracy
  8. Why hydrogen is no magic solution for EU Green Deal

Join EUobserver

Support quality EU news

Join us