While the state’s cash flow problems are manageable at the beginning of this week, today marks the start of a tough period for the Finance Ministry that will require crisis management on a daily basis.
Sources say that the state would not normally have the resources to cover the payments due for today at hand, but the ministry has opted to utilize general government entities’ disposable cash reserves, which are kept in commercial bank accounts. This way the country’s cash obligations are estimated to be covered up to early March, although mid-March will pose a bigger problem and there is no stopgap solution for that.
Next week the state must repay its creditors 1.8 billion euros, of which 1.4 billion concerns treasury bills expiring on March 6, the same day as the deadline for the payment of 310 million euros to the International Monetary Fund.
On March 13 Greece will need to repay 350 million euros to the IMF, while T-bills of 1.6 billion euros will mature on the same day and will in theory have to be replaced by a new issue. Then on March 16 Greece will have to pay another 580 million euros to the IMF, with 350 million due four days later. Also, T-bills adding up to another 1.6 billion mature on March 20 and will require a fresh issue.
The state will also have more unavoidable expenditure that it must somehow cover next month: For instance, Greece needs to pay interest amounting to 800 million euros, while the money required for salaries and pensions amounts to no less than 1.5 billion euros. Furthermore public spending on insurance, healthcare and social protection next month adds up to 1.3 billion.