BRUSSELS (Reuters) – On a rainy Friday night in Berlin, sometime in the next 18 months, Angela Merkel receives a telephone call from the president of the European Central Bank.
Let us imagine the scenario. Any resemblance with reality, as they say in the movies, is purely coincidental.
Greece has once again fallen behind on its deficit reduction targets because of its inability to collect taxes. Privatisation plans are behind schedule and investors are shunning the asset sales because of labour unrest and political instability.
A second EU/IMF bailout cobbled together in September 2011 and forced through reluctant parliaments is falling apart.
The International Monetary Fund’s board is no longer willing to release more aid for Athens, which will run out of cash within days, causing the euro zone’s first sovereign default.