After a delay of several months, Greece will now receive its next credit tranche. Yesterday, European finance ministers and the International Monetary Fund (IMF) agreed a deal allowing a payout of EUR 8.5bn, thereby preventing the liquidity bottleneck which had been looming threateningly on the horizon for July. The creditors were able to bring an end to the tough negotiations by finding a compromise. Although the IMF will now formally participate in the third rescue package, it has announced that it will only make loan payments once the EMU creditors have finalised their plans for debt service relief. This means that, above all, Berlin has achieved its main objective: the IMF will retain its place at the negotiation table and, at the same time, the unpopular discussions regarding the debt service relief have been put off until next year, which will be after the German parliamentary elections.
This has neither solved nor defused the conflict between Greece and its creditors, which has been progressing at a steady pace. Instead, it has just postponed it until a later date. The result of these negotiations will surely be beneficial for Tsipras’ government – it was able to stave off national bankruptcy once again. The government’s hopes of partial relief with regard to its financial liabilities may now even be raised. However, a high volume of maturities will again fall due in 2019 which, as it stands, the government will not be in a position to pay out of its own pocket. As parliamentary elections are due to take place in Greece during that year, the calls for “reforms for money” are bound to be heard by then again. Yesterday’s compromise is yet another measure which puts Greece’s actual debt problems and the liability risk for its European neighbours on the back-burner instead of resolving them properly, once and for all.