Greece Has More Dept to Its Nation than to the Creditors

• 03.05.2015, 19:54
•  Europe,  World

Greece has a lot of duties to fulfill in the upcoming weeks. It needs to refinance about 6.5 billion euros in debt and interest. On the other hand there is the budget forecast, which is 2.1 billion euros cash deficit in March. Only tax-revenue shortfall has already opened a hole of 217 million euros in the first month of 2015. The Finance Minister Varoufakis said that there is an alternative plan to plug its financing shortfall in March, but he did not explain what he meant, Bloomberg reports.

The economic problems in Greece are not limited only with the European partners and foreign debt, there are a lot of tasks to be solved in the social and economical life as well. Greek government has been covering its cash deficit by tapping the reserves of public entities, such as pension funds, hospitals, and universities. Greece’s GDP shrank in the last quarter of 2014, while nine months ago it had growth. The purchasing index showed manufacturing activity kept contracting in January and February 2015. Depositers have withdrawn 20 billion euros from Greek banks. As it can be seen from the above mentioned numbers, the country has tough economic problems, which makes the creditors be doubtful about repayments, as Greece prepares for a reimbursement of 300 million euros to the IMF (International Monetary Fund) on Friday. The country needs to refinance treasury bills totaling 1.6 billion euros next week and pay about 420 million euros in IMF amortization and interest on its dept. The bill rises to 3.1 billion euros in case of delay, out of which 913 million euros are due to the IMF, Bloomberg reports.

Even if Greece manages to reimburse its bills to the foreign creditors, the country still has a large number of people who should be pulled out from poverty. The country’s private sector, whichcomprises more than a quarter of the workforce is without a job. Most of these people are doing seasonal jobs. Jobless people need the support of the government, which is huge burden for the country. The dept to its own nation is much bigger than the foreign creditors are asking to pay.