Global Business and Economics Program Director Andrea Montanino writes for US News and World Report on why all parties in the unfolding Greek budget tragedy are facing serious constraints:
Two weekends are left to either find a deal for Greece or have it declare that it is unable to pay its debts. By June 30, Greece must reimburse this month’s $1.7 billion payment to the International Monetary Fund. However, it lacks the funds to do so. If Greece cannot come to an agreement with its lenders to buy more time, the only option will be to default, leading swiftly to a rush to the exit signs as citizens and investors pull whatever remaining money they have out of Athens.
Unfortunately, the three parties in these negotiations – the IMF, the European institutions and the Greek government – are stuck. Each of them has serious constraints that make reaching a deal extremely difficult.