GREEK finance ministry bought itself some time yesterday by taking €555m (£394bn) from a bank rescue fund.
The fund – the Hellenic Financial Stability Fund (HFSF) – was used in to recapitalise the country’s main lenders in 2012.
Greece’s four largest banks handed over this money following their recapitalisation.
But the amount is a drop in the ocean compared to the €5.7bn debt repayments due this month.
Meetings will begin today between Greece and its creditors. If they can agree on the reforms the country will undertake, Greece will be handed the remaining €7.2bn slice of its second bailout loan, but these talks could drag on for weeks.
“With a cash crunch now visible in the horizon, the only real alternative is to tap this year’s Troika instalments. Otherwise, the authorities will need to resort to fiscal acrobatics with likely short-lived success,” said economist Konstantinos Venetis from Lombard Street Research.
“Greece’s leaders need to shift from game theory to realpolitik unless they are seriously considering heading for the exit.”