Though it is likely that everyone is aware of this but if not lets clear the air once and for all.
Greek hasn't secured any deal so far. It has passed several initial measures through parliament to secure an option to negotiate with European partners/lenders to secure a deal for three years which could be as large as € 86 billion...... By passing the measures Greece has also secured a bridge financing from European partners or lenders worth € 7.16 billion, which has helped the country to clear its dues with IMF, ECB and Bank of Greece.
So probabilities are high that final deal may remain out of reach, in spite of some initial success.
Why?
Deadlock and skepticism.
- German Chancellor Angela Merkel wants IMF into the negotiation due to its vast experience, large coffer and expertise.
- However, IMF has warned European partners that it will not be a part of Greek third bailout unless debt relief is provided to make the Greek debt more sustainable. IMF has already been criticized for its passive role and over exposure in Greek crisis. It is unlikely to repeat mistakes.
- German finance minister Mr. Wolfgang Schäuble, indicated a debt write off is not possible as long as Greece is in Euro area. A relief might be provided if Greece takes a time out from Euro area or else it will come in other form such as increasing maturity, cutting interest rates. In spite of recent success, Mr. Schäuble is keeping the plan B of Grexit close, just in case negotiation fails.
- Greek Prime Minister openly declared his skepticism and disbelief over the deal and he was forced to accept it due to lack of alternative to avoid Grexit. How much can he be trusted to implement those reforms?
