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Today is the deadline for Greece to repay 1.6 billion euro to the International Monetary Fund and for several days already, ministers and other government sources have been warning that it will fail to make the payment. However, this will not cause the global credit rating agencies to declare Greece’s bankruptcy. At least not in the next 30 days, i.e. until 30 July when, if Athens fails to pay that portion of its loan, the International Monetary Fund will start the procedure laid down in the statute, which applies to incorrect debtors.
    It provides for a team of the International Monetary Fund to arrive in Athens to urge the Greek government to immediately repay its obligation. Meanwhile, the state will not be able to use any funds from the International Monetary Fund until it pays its debt. Two weeks later, the Executive Director of the organization has to send a letter to all heads of the member states to inform them that Greece is not fulfilling its obligations as a member of the International Monetary Fund. After another two weeks, the Executive Director will notify of the incorrect debtor the Board of Directors and its director will turn to ISDA, the International Swaps and Derivatives Association, the organization that triggers insurance against a sovereign default. It will announce the non-payment of obligations to the International Monetary Fund as a credit event, which will mean an official sovereign default.
    In view of the dramatic events in Athens, 30 days are too long a period to make any forecasts but Greece is at risk of finding itself in the situation of cross default, in which the non-payment of one portion of the debt leads to the non-payment of another part of the debt. What does this mean? Director of the European Financial Stability Facility Klaus Regling has already warned that Greece will have to return all the 140 billion euro provided as liquidity to its banks.