Thursday

20th Sep 2018

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 18 year's of archives. 30 days free trial.

... or join 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.

News in Brief

  1. Greece to move asylum-seekers from overcrowded Lesbos camp
  2. Transatlantic soya trade soars due to trade wars
  3. EU tables strategy for connecting Europe and Asia
  4. Bulgaria backs Hungary in dispute with EU
  5. Trump urged Spain to build Sahara wall to stop migrants
  6. EU-Arab League summit proposed for February in Egypt
  7. Stop 'migration blame-game', Tusk tells EU leaders
  8. McDonald's Luxembourg tax deal 'compatible' with EU rules

Stakeholders' Highlights

  1. NORDIC COUNCIL OF MINISTERSThe Nordic gender effect goes international
  2. NORDIC COUNCIL OF MINISTERSPaula Lehtomaki from Finland elected as the Council's first female Secretary General
  3. NORDIC COUNCIL OF MINISTERSNordic design sets the stage at COP24, running a competition for sustainable chairs.
  4. Counter BalanceIn Kenya, a motorway funded by the European Investment Bank runs over roadside dwellers
  5. ACCACompany Law Package: Making the Best of Digital and Cross Border Mobility,
  6. IPHRCivil Society Worried About Shortcomings in EU-Kyrgyzstan Human Rights Dialogue
  7. UNESDAThe European Soft Drinks Industry Supports over 1.7 Million Jobs
  8. Mission of China to the EUJointly Building Belt and Road Initiative Leads to a Better Future for All
  9. IPHRCivil society asks PACE to appoint Rapporteur to probe issue of political prisoners in Azerbaijan
  10. ACCASocial Mobility – How Can We Increase Opportunities Through Training and Education?
  11. Nordic Council of MinistersEnergy Solutions for a Greener Tomorrow
  12. UNICEFWhat Kind of Europe Do Children Want? Unicef & Eurochild Launch Survey on the Europe Kids Want

Latest News

  1. EU divisions on menu at Salzburg dinner
  2. EU mulls action to prevent cattle suffering at Turkish border
  3. Safeguarding Schengen at Salzburg
  4. Denmark's image 'damaged' by bank scandal
  5. Real Brexit progress needed by October, Barnier says
  6. Poland to face EU top court on rule of law
  7. Austria's EU presidency: a bridge over troubled water?
  8. EU promotes 'Egypt model' to reduce migrant numbers

Join EUobserver

Support quality EU news

Join us