Metro Manila (CNN Philippines) — The International Monetary Fund (IMF) announced today (July 1 PHT) that Greece has defaulted on a $1.7 billion (EUR 1.5 billion) IMF loan.
Greece subsequently becomes the first developed country to default to the IMF. The missed repayment is the largest in IMF history.
“I confirm that the SDR [Special Drawing Rights] 1.2 billion repayment (about EUR 1.5 billion) due by Greece to the IMF today has not been received,” said IMF Director of Communications Gerry Rice in a statement.
“We have informed our Executive Board that Greece is now in arrears and can only receive IMF financing once the arrears are cleared.”
Rice also confirmed that Greek authorities have asked the IMF for an extension of the country’s repayment obligations.
The country shutdown its banks on Monday in a bid to prevent financial collapse. Greek officials have said that the banks will remained closed until July 6, with daily withdrawals limited to just 67 euros.
Greeks are headed to a referendum on July 5 to decide whether or not the country should accept terms to a bailout plan from Europe and the IMF.
The country faces a rough road ahead regardless of the outcome.
Greek Prime Minister Alexis Tsipras has urged his countrymen to vote against the bailout proposal. He recently hinted on Greek TV that he would quit his post should Greeks approve the bailout. “[W]e [the ruling party] will respect it, but we will not carry it out.”
On the other hand, a No vote could lead to Greece’s exit from the eurozone. The country could stop using the euro as its official currency and return to the drachma. European Commission President Jean-Claude Juncker said that a No vote would mean that Greeks “[A]re saying no to Europe.”
