Available funds will fall from $4.5 billion on May 11 to $900 million on June 18
ATHENS (AFP) ― Former Greek prime minister Lucas Papademos warned Greece may run out of money by the end of June if international bailout funds are cut off following next month’s election, a newspaper reported Sunday.
“From late June onwards, the ability of the government to fund its obligations fully depends on the approval of the subsequent installments of loans from the EFSF and the IMF,” To Vima newspaper quoted Papademos as saying in a leaked memo.
“The available funds in the Greek government will be reduced gradually from about 3.8 billion euros ($4.5 billion) on May 11 to about 700 million euros ($900 million) on June 18 and from June 20 will enter negative territory at the level of around one billion euros.”
Centre-left To Vima said Papademos made the warning in a memo to President Carolos Papoulias dated May 11 that was then circulated to party leaders as they tried to form a coalition after an inconclusive May 6 vote.
A passenger waits on a metro train platform near a Greek euro currency advertisment in Athens, Greece, on Thursday, May 24, 2012. European leaders tied their next steps on the financial crisis to the outcome of a bitterly contested election in Greece that may determine whether the 17-nation euro currency splinters. Photographer: Kostas Tsironis/BloombergA passenger waits on a metro train platform near a Greek euro currency advertisment in Athens. (Bloomberg)
Greece in 2010 committed itself to a reform program in return for hundreds of billions of euros (dollars) in bailout funds from the the European Union bailout fund EFSF and the International Monetary Fund.
On May 6 voters weary with salary cuts and other austerity measures handed second place to radical left-wing party Syriza, which has threatened to renege on the bailout accords.
If Greece broke the terms of the deal and forfeited its bailout funds, it would likely default on its debts and may leave the eurozone.
Ahead of a new election on June 17, Syriza has led at times in the opinion polls, but a series of polls published Sunday indicated conservative party New Democracy was favourite to win.
The new surveys by five separate polling groups predict a New Democracy victory ranging between 23.3 percent and 25.8 percent, a result that would still require the party to seek additional allies to form a viable government.
Syriza polled in second place ahead of the socialist former ruling party Pasok, which like New Democracy defends the bailout agreement.
New Democracy, part of the previous ruling coalition that signed on to the bailout deal, has said it will seek to renegotiate parts of the package but not scrap it completely.
