Washington, D.C., July 1 (ANI): After Greece defaulted on a key loan payment to the International Monetary Fund (IMF) yesterday, experts have warned that the crisis-stricken country is walking through a minefield now and can exit the eurozone at any point.
Gabriel Sterne of Oxford Economics had thought that European creditors might still find a way to resolve their differences until today. He said that even if Greece received a ‘yes’ vote on the referendum, the situation would be ‘pretty desperate’, reported National Public Radio.
While noting that the capital controls and bank shutdowns imposed by the Greek government this week had complicated the economic scenario greatly, Sterne pointed out that it would be difficult to restore credibility in the financial system in its aftermath.
Diego Ferro, co-chief investment officer at Greylock Capital, on the other hand, dubbed the recently imposed controls as ‘insane,’ saying that even if they got a good deal, the economy would be worse off.
He also pointed out that Greece’s exit from the eurozone will raise questions over the viability of the currency union and prompt other countries to flee as well. The bank closures in the country are bound to put political pressure on Greece’s left-wing government to come up with some kind of deal, adding that the two sides will have plenty of time to chalk out an agreement.
However, Anna Gelpern, a non-resident senior fellow at the Peterson Institute for International Economics, said that at a time when there is no error margin, everybody is on tenterhooks and there is an enormous amount of volatility that could set off a panic and lead to unexpected results. (ANI)