IMF declares Greece in 'arrears'
At 22:00 GMT, Greece officially defaulted on its debt to the IMF; Eurogroup to meet on Wednesday in final effort

As of 2200 GMT on Tuesday, the International Monetary Fund declared Greece in arrears on its debt obligations.

IMF spokesman Gerry Rice said: "I confirm that the SDR 1.2 billion repayment (about €1.5 billion) due by Greece to the IMF today has not been received. We have informed our Executive Board that Greece is now in arrears and can only receive IMF financing once the arrears are cleared."

Rice noted that Greece had requested a delay of payment, and that the request had been submitted to the board of the agency.

The Eurogroup will meet on Wednesday, July 1 to consider further proposals on aid to Greece.

However, the bailout that began in 2010, and that has disbursed about €240 billion ($267.3 billion at current euro value) to the country, is now officially ended.

Separately, credit agency Fitch Ratings has downgraded Greece's sovereign credit rating by one notch to "CC” from "CCC”. The rating "CC” is at the level of high-risk "junk” bonds. The change was made in the wake of the breakdown of negotiations between Greece and its creditors.

Eurogroup rejects Greek bailout proposals

The Eurogroup on Tuesday rejected a Greek proposal for a two-year bailout plan.

The decision by the eurozone finance ministers leaves Greece with no choice but to default on its 1.6 billion euro ($1.8 billion) obligation to the International Monetary Fund due on Tuesday.

There was no comment from the group following a teleconference to consider the latest Greek proposal. Another Eurogroup meeting is set for Wednesday when Greece intends to make further proposals, Eurogroup chairman Jeroen Dijsselbloem told the Frankfurter Allgemeine Zeitung.

Klaus Regling, chief of the European Financial Stability Facility, a crisis fund for Eurogroup members, said the rejection puts "the positive results of the [current bailout] program at risk."

He added that it was "regrettable" that Greece had no new bailout program in the pipeline.

Greece will run a referendum on its creditors’ bailout proposals on Sunday.

Earlier, German Chancellor Angela Merkel refused to discuss any new bailout requests until after Sunday’s referendum.

"Before the referendum Germany can’t negotiate a new request,” Merkel said after a party meeting.

Merkel's response seemed to shut the door on Greece's last-ditch request for a bailout package even before the Eurogroup rejection of Greek Prime Minister Alexis Tsipras plan to access the eurozone’s crisis bailout fund.

The fund can be distributed to a member state "if indispensable to safeguard the stability of the euro area as a whole.”

On top of a two-year loan, Tsipras had asked the Eurogroup to extend the country’s current bailout program "for a short period of time in order to ensure a technical default is not triggered.”

He also asked for a plan to restructure Greece's debt.

Crowdfunding campaign to save Greece

As Greece struggles with closed banks and makes a further attempt to negotiate with the Eurogroup, a London shoe salesman is making an independent effort to save Greece.

On June 29, Thom Feeney, 29, launched a crowdfunding program on indiegogo calling for donations to save the Greek economy – the goal is to raise the €1.6 billion ($1.8 billion) needed to pay Greece’s defaulted debt to the International Monetary Fund.

Sounds foolish? Feeney’s "Greek Bailout Fund” has raised close to €600,000 in two days, and traffic to his page on indiegogo has crashed the entire crowdfunding platform on two occasions. It has attracted more than 50,000 investors.

"I was fed up of the Greek crisis going round in circles, while politicians are dithering, this is affecting real people. While all the posturing is going on, then it’s easy for the politicians to forget that. I just thought, sod it, I’ll have a crack,” Feeney wrote on his crowdfunding page.

Feeney states on his page that Greece would be better letting "the people" decide its fate rather than European ministers. "The European Union is home to 503 million people, if we all just chip in a few euro then we can get Greece sorted and hopefully get them back on track soon. Easy," Feeney wrote.

"It might seem like a lot but it's only just over €3 from each European. That's about the same as half a pint in London. Or everyone in the EU just having a Feta and Olive salad for lunch."

Crowdfunding projects must achieve their goals in order to receive the funds that have been raised, otherwise they are returned to the senders. Feeney offers some bonus gifts to investors – a €3 euro investment for a postcard of Greek Prime Minister Tsipras, and €25 for a bottle of Greek wine. But it is likely to take just a lot of good, old fashioned generosity for the project to reach its goal.

Last Modified: 2015-07-01 09:24:35
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