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A new loan disbursement to Greece of $8.5 billion euros goes ahead in June 2017. Greece has to repay 7 billion euros in July 2017. The German parliament set as a condition for approval that the IMF also participate in the Greece bailout. Germany's finance minister Schauble stated that it was particularly important to increase Greece's competitiveness,  to help Greece "stand on its own  two feet" by the middle of 2018. The IMF under Christine Lagarde, and the eurozone group say that Greece has implemented the reforms requested. Greece's ruling party Syriza split over accepting the reform package, with its leader Tsipras finally accepting the need for the Third Bailout program following a referendum and parliamentary elections in 2015. The IMF under Lagarde has stepped in to support Greece in its effort to seek conditions that make the debt program workable for Greece.

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A four month extension till the end of June was agreed to in negotiations between the EU, IMF, ECB, and the government of Greece. Under the agreement Greece will have to present a list of budget cuts and economic changes to the EU, ECB and IMF on Feb. 23, 2015. This will be reviewed by EU finance ministers on Feb 24. The economic measures will have to be implemented for Greece to get its 7.2 billion euro instalment pot pf a 240 billion euro bailout.

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IMF forecasts for Greece's growth rate are proving too optimistic. The IMF forecast is for zero growth in 2013, and increases of 2.3% and 2.9% in 2014 and 2015. Even in its pessimistic projections the IMF forecasts a 1% downturn in 2013 and growth of 1.3% and 1.9% in 2014 and 2015. The government sector was a large part of the economy. Now that this is shrinking, the export sector which only represents 20% of GDP is too small to generate needed growth. Greece also lacks the competitiveness and the large foreign enterprises that operate in Ireland, making growth less likely. A major problem is also the 40 billion euros Greeks have withdrawn from their banks in recent years. Even the figure of 120% of GDP that is expected in 2020 under the March 2012, 130 billion euro bailout is a very hypothetical figure, having no sound basis. Landon Thomas cites a confidential study the IMF had circulated in February 2012, showing the long term prospect for Greek debt if growth does not materialize because of lack of competitiveness. It would increase the debt to GDP ratio to 178% by 2015, and leave it at the current level of 160% of GDP in 2020. Some experts say the whole debt sustainability analysis makes no sense, with the question being insolvency in the case of Greece, not illiquidity. And requiring a focus to bring debt to manageable level to create prospects for growth. The Wall Street Journal emphasizes this in its editorial on Feb. 29, 2012....

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All sides had to make concessions to reach a new agreement on a restructuring of Greece's debt, and new terms for loans to Ireland and Portugal. The agreement was reached after negotiations between France, Germany, the ECB, and eurozone countries with a declaration issued on July 21, 2011. The powers and financing of the European Financial Stability Facility (EFSF) were expanded to be the main mechanism for channeling EU funding to reduce the burden of Greece's debt. Germany will provide new funding and be open to additional commitments, something German chancellor Angela Merkel had resisted since the beginning of the crisis in 2010. Earlier funding had come with high interest rates and only when the situation had reached a crisis, with Germany insisting on the punitive rates and conditions as a way to discourage countries from taking advantage of cheap borrowing. In exchange for commitment of German funds Ms Merkel had insisted that banks and private creditors share in the losses. Private bondholders resisted but finally agreed to take a loss of 20% of principal on a small portion of the bonds. Their larger concession was to take lower interest rates and extend the maturities to 15 years and 30 years on new bonds which are guaranteed by the EU. The specific terms of the agreement are as follows: The EFSF and the IMF will lend Greece 109 billion euros over 3 years at 3.5%. Private creditors including German and French banks will "voluntarily" turn in their old bonds for new ones that mature over 15-30 year periods. These new bonds include 15 and 30 year Greek bonds with varying coupons. Some of the bonds would have a 20% discount on principal. EU leaders say the private sector contribution amounts to 37 billion euros through 2014 and 106 billion euros through 2019. Another part of the program is for the EFSF to buy back some of the Greek bonds on the secondary markets, which would mean Greece would now owe a smaller amount to the EFSF on these bonds. The EFSF will now have additional financial support from Germany and other EU countries and be authorized to provide aid to countries before a crisis situation arises. It would also have power to buy Greek bonds at prices on secondary markets to reduce the Greek debt burden. Ireland and Portugal are also assisted in the agreement. The interest rate for EU aid to Ireland and Portugal is taken down to 3.5%. Ireland is paying about 6% on the EU portion of its 67.5 billon euros bailout and efforts to reduce the rate were resisted earlier. The main theme behind these concessions and provisions is to give Greece, (and Ireland and Portugal) a chance to grow. High interest rates came under strong criticism because it only increased the size of the debt burden of these countries with a shrinking economy and high unemployment. The failure to come together behind a broad and sensible agreement with all parties making serious concessions, the EU, the ECB and the political leadership in these countries especially Greece, was undermining confidence in the euro and the eurozone itself. By mid-July Italy and Spain were feeling the effects of contagion in the financial markets, U.S. debt ceiling negotiations were unsettling global financial markets, the pressure was intense to come up with the workable agreement achieved on July 21, 2011. ...

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A critical flaw in the IMF and EU's plan for Greece is the optimistic forecasts for Greece. The IMF forecast was for the Greek economy to decline by 2.6% of GDP in 2011, yet estimates now are for a decline of 6.8%. As a result even with a second bailout for $130 billion the situation is likely to deteriorate as the economy contracts faster than the IMF predicts and the debt continues to remain unsustainable. With no pro-growth policy in place the situation provides little hope for the Greeks. Kenneth Rogoff, a Harvard economics professor, says he is astounded by the short term psychology that gives financial markets hope that something will work.

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Flexibility from the IMF, the ECB and the EC in negotiating new terms for Greece after the June 2012 elections and initial efforts for revising the March 2012 loan agreement.

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New Democracy led by Antonis Samaras comes in first with 29% of the vote compared to 26% for Syriza led by Alexis Tsipras in the June 2012 Greece elections.

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Alexis Tsipras and the Syriza government in Greece call for a referendum on July 5, 2015 on the spending cuts and policy changes proposed by the European Union and the IMF.

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The cost of the first bailout for Greece of May 2010 is 53 billion euros for eurozone funds and 20 billion euros for IMF funds, according to the European Commission. The cost of the second bailout for Greece of March 2012 is 142 billion euros for eurozone funds and 12 billion euros for IMF funds. The eurozone took back 11 billion euros following the failure of negotiations.

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Spending a minimum of 250,000 euros on a house in Greece gets an investor a five year renewable visa. Chinese investors seeking a European base are buying or constructing homes in Athens, and the islands of Santorini and Corfu. This is reviving the residential building market in Greece after years of bailouts by the European Central Bank. Chinese middle class investors see the presence of Chinese companies such as Cosco which owns part of the port of Piraeus as a sign it is safe to invest in Greece. Property prices dropped 40% in 2010. In 2018 prices went up by 2% and building permits by 10%, according to the Bank of Greece. Real estate investment was up 20% in 2018 with Chinese investment companies buying into whole apartment blocks in Athens to draw investors.

Greece had a record 33 million tourists in 2018. A 320 billion euros bailout ended in 2018. 

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John Taylor looks one step ahead of the March 2012 Greece bailout and sets up the most plausible scenario for the future. He says the risks of contagion were always exaggerated from the beginning- a planned default or restructuring of debt such as happened in Argentina in 2001, does not have the contagion risks associated with a chaotic and unplanned default as in Russia in 1998. Predicability in policy makes a huge difference, says Taylor. The European banks which stood to lose from writedowns exaggerated the fears of contagion- a process that always occurs for people who are adversely affected by writedowns- resulting in top officials in the European Union delaying the unavoidable serious restructuring. It was not until Chancellor Merkel handed Charles Dallara, who negotiated for the European banks, a note stating a demand for 50% bondholder writedown, on October 27, 2011, at EU headquarters in Brussels, did any serious writedown of debt begin. Merkel told Dallara: "this is my last offer." The July 2011 summit by contrast had only a 10% bondholder writedown in the agreement, when insolvency not illiquidity was the real issue. Walker Forelle and Meichtry, give a detailed account of what happened in the Wall Street Journal, Dec. 30, 2011. The important thing for Greece, says Taylor, is for what the IMF calls "growth enhancing structural reforms" - greater reliance on private markets, incentives, rule of law. He says this bailout won't work because IMF growth forecasts do not reflect the rapid shrinking of the Greek economy. Antonis Samaras, leader of the major opposition party, is in favor of pro-growth measures and has stated his desire to change the agreement. The 130 billion euro bailout provides 90 billion euros for recapitalizing Greece's banks, and financing the budget. This puts Greece in a situation where the political leaders win voter support by discarding the conditions from the Northern EU nations and come with a plan that is better suited for Greece. The EU in this scenario would cut off further bailout funds to Greece. Taylor sees this as the better outcome for Greece than the current situation, which leaves Greece no hope for growth, and also for the EU by getting out of bailouts that have little prospect of working. It would be difficult but doable for Greece says Taylor, because interest payments would be low and Greek banks would be recapitalized after the current March 2012 bailout. ...

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Opinion polls in late July 2015 showed Syriza with support of 33% from Greek voters, well ahead of other parties. After accepting the third EU bailout following a "no" vote in a referendum in early July, prime minister Tsipras still remains popular in Greece. On August 20, Tsipras announced snap elections to win a new mandate to implement the program of cuts that enabled Greece to get 96 billion euros in the third bailout program. Some members of his own party remain opposed to the bailout, and Tsipras relied on opposition parties support to get approval of the bailout in the Greek parliament.

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Greece defaulted on a loan payment to the IMF for 1.55 billion euros ($1.73 billion) on June 30, 2015.

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Even government ministers line up at ATM's near the parliament building as Greece pulls out of bailout talks with EU finance ministers and calls for a referendum on bailout conditions for July 5, 2015. A decision by Greece on imposing capital controls is expected.

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IMF's differences with Greece and Germany on relative weight of tax hikes and cuts to pensions for the Third Bailout Program accepted by Greece in July 2015. The IMF wants to see further cuts in pensions, the Tsipras centre- left government in Greece is committed to protecting pensioners and the poor, and has agreed to tax hikes that do not put a disproportionate burden on the poor and working class. The IMF fears the relative weight on tax hikes for generating a surplus to pay down debt could hurt prospects for economic growth.

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Rolf Wetzer, a German metal working factory manager reflects feelings widespread in Germany. He says, we work hard and save our money, and he can't see why Germans have to throw money at countries that cannot do the same. There is considerable negative feeling about the bailout of Greece, because it is seen as brought about by the excessive spending, public corruption, and irresponsible accounting that went on in Greece. There is less negative feeling about the bailout of Ireland, as the Irish are seen as an industrious people, and the crisis was brought upon Ireland by Irish banks. Because of the negative feeling it will be much harder for Angela Merkel to go back to the German parliament for more funds, especially as her popularity has suffered. The existing fund will be stretched by the possible bailout of Portugal and Spain. Germany remains committed to the euro, but there is considerable anger about the bailouts. Germany has benefitted from the euro-zone through its exports, which jumped 31% in the last decade. Germany has a $105 billion trade surplus with the rest of Europe. At the same time there is fear that public opinion may turn against the euro. Thomas Mayer, chief economist at Deutsche Bank, says you can already feel it. Frank Schaeffer, a legislator for the Free Democrats, says that whether Germany needs the same currency as its neighbors is something he has doubts about....

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The confusion among Tsipras supporters in Athens as the creditor terms that are stricter than the ones rejected in the July 5, 2015 referendum win 250 votes out of 300 in the Greek parliament on July 10, 2014. The centre right New Democracy and centre left Pasok parties and other parties support Tsipras, and the far left of Syriza abstains in the vote. Serious damage was done to the economy in the 6 months of Syriza negotiations ending in the referendum, increasing the size of a new bailout. The increase size of the bailout came as a shock in Germany reducing any flexibility for chancellor Merkel in the internal debate within Germany. In addition relations were damaged with the EU by the referendum and Syriza's handling of it. As a result opinion polls showed German support for concessions dropped to a low of 10%, increasing pressure on chancellor Merkel within her CDU party. Analysts say Greeece could lose another 10% drop in output if Greece leaves the eurozone, showing the risks taken by the far left Syriza party and economic mismanagement. Even if it stays within the eurozone Greece faces additional costs with lower tax revenues from the fallout in the economy of events in July 2015. Greek officials say the restrictions on ATM withdrawals to 60 euros a day for each account could stay in place for months. These developments are not taken into account by academics and young people in Greece as they refer to European solidarity. ...

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EU leaders, the ECB and the European Financial Stability Facility, in negotiations for a "selective default" for Greece. The ECB is persuaded to accept a selective default, with one option being to protect ECB from losses by the EFSF buying 50 billion euros of Greek bonds at cost price. Another concern of ECB about contagion is being addressed through a statment that this is designed only for Greece because "of its exceptional situation." A draft document under discussion by EU leaders has a plan for cutting the interest rates on Greece's bailout loans from 5.5% to 3.5% and doubling the repayment period to 15 years. EU officials see giving Ireland and Portugal the same interest rates on their bailout loans. The high interest rates and the shorter maturities made earlier plans unworkable. Private investors are encoraged but not required to exchange their old Greek bonds for new bonds with maturities of upto 30 years. Also being discussed is a buyback of Greek bonds at a heavy discount to face value at which they are trading. EFSF will also get new powers to make bailout loans on a precautionary basis. EFSF would also have powers to lend to eurozoe governments to help recapitalize banks and buy back bonds from other countries....