Senior EU officials have formally discussed for the first time a possible Greek debt default, Reuters reported on Friday. With an end-June deadline for the repayment of EUR 1.6 B debt to the IMF looming and talks between Greece and its international creditors stalled, Eurogroup government representatives discussed formally the possibility of Greek default at talks in Slovakia's capital Bratislava late on Thursday. This possible scenario was discussed for the first time at such a senior level in the EU, Reuters said. Two other scenarios were also discussed, with the least likely being the clinching a reform-for-cash deal next week in time to meet end-June legal deadlines. Another possibility was a further extension of the current bailout programme, which expires at the end of June. The meeting reached no decision or concrete conclusion, according to Reuters. On Thursday, the IMF effectively walked away from the bailout talks with Greece, citing lack of progress on the major points of disagreement with the government in Athens. The sending of the IMF negotiators on the Greek rescue programme back to Washington is “the starkest sign yet that Athens may be forced to default on its debts at the end of the month,” according to the New York Times. And Germany’s Bild reported on Friday the government in Berlin was preparing for the possibility of a Greek default. According to unidentified sources familiar with the government’s position, Chancellor Angela Merkel’s advisers are discussing how to deal with a default, including capital controls for Greek banking clients and a debt cut, Bild said. The Greek government is struggling to unlock billions of euros as part of a deal that would allow it to make debt repayments. Greece’s creditors have made financial assistance conditional on austerity measures and economic reforms which the left-wing Greek government was elected to oppose.
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