Greece makes payment and Europe sighs in relief

After some concern that Greece would not, or could not make a payment on its 240 billion euro debt, Greece announced that it has scheduled a 460 million euro payment that will be made to the IMF on time.

Greece and Eurozone finance ministers struggled earlier this year to reach an extension on its bailout.

The negotiations particularly strained relations between Greece and the most economically powerful eurozone member, Germany.

The Germans and other Eurozone finance ministers were pushing Greece to enact major reforms in order to receive their extension including cancelling an increase in the minimum wage and welfare spending which were promised by the recently elected leftist Syriza coalition government.

The Syriza government, led by Prime Minister Alexis Tsipras, has refused to scale back on those promises, but instead has introduced reforms to tackle tax evasion and corruption.

For their part, the Greeks have chosen this time to bring-up the issue of war reparations they feel are still owed their country from Germany dating back to World War II.

Greece claims that Germany owes it 279 billion euros for damage it inflicted on the country during the war.

Berlin however, states that the issue of war reparations has been settled.

The Greek demand was “stupid,” said Germany’s Vice Chancellor Sigmar Gabriel.

“(This) has absolutely nothing to do with World War Two or reparation payments,” continued Gabriel.

The announcement that Greece would make its debt payment on time, resulted in a dip in government bond yields.

Unemployment in Greece is still 25.7%.

 

[CNN]