In early April, Greek Finance Minister, Yanis Varoufakis smoothed over some confidence inquiries into the country’s ability to pay off its debt. Many have been fearing default as the deadline for a large loan payment nears, which the government owed to International Monetary Fund. Citing that Greece plans to “meet all obligations to its creditors” Varoufakis aimed to give a boost to the peace of mind that many lenders have lost over the years.
Plans for the Greek Finance Department to reform their common practices and repair relationships with their lenders are already underway. This year to date, Greece has been borrowing from state entities and has not accepted bailout funding this August 2014. Due this Thursday, a 450 million euro loan is coming to maturity and due to the IMF, the source of some skepticism regarding Greek economic strength.
All indications are pointing to Greece making its payment by the due date. After a meeting between Varoufakis and the IMF Managing Director, Christine Lagarde cited that their conversation went well and all was on schedule.
Currently a number of banks who led the bailout effort have frozen their funds to support the country until their government rolls out a new financial reform package that meets the standard of the lenders. To ensure that money will not be lost, lenders turned down the initial proposal from the Greeks.
The funding freeze puts pressure on the country to find monetary ways of keeping their heads above water while reforms are drafted and reviewed. The government has assured that no pension or wage cuts will be present across the economic struggle and not at risk. Approval of reforms will lead to the freedom of 7.2 billion euros from its bailout agreement as well as 1.9 billion made in profits through Greek bonds from the European Central Bank.
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