Greece no longer in default

He said that the issue of Greece’s debt sustainability will “certainly” be part of the bailout negotiations.

Their reopening followed Prime Minister Alexis Tsipras’ reluctant acceptance of a tough package of bailout demands from European partners, but a revolt in the ruling Syriza party now threatens the stability of his government and officials say new elections may be held as early as September or October.

Four point two billion euros in principal and interest is on its way to the European Central Bank – meeting Monday’s deadline.

A default would have put further assistance from the ECB in jeopardy – and it is financial aid from the ECB that is now keeping the Greek banks functioning.

The green light to the opening of discussions, which are expected to last around a month, was given Friday.

Control, including the ones on flight of capital however, remain.

Despite widespread domestic opposition, the Greek government last week agreed to raise taxes, overhaul the pension system and carry out privatizations in order to receive a new bailout of 86 billion euros (USD 93.3 billion) over the next three years. The controls were introduced because negotiations with creditors had reached an impasse, fueling fears of a Greek exit from the euro and a bank run.

Just because the doors of Greek banks are open today, don’t be fooled into thinking they and the Greek economy are anywhere near back to recovery. There were no reports of any problems.

In a decree published on July 18, the Greek government added a weekly limit to the 60 euros ($65) daily cash withdrawal limit.

The announcement by the International Monetary Fund comes as Greek banks reopened after being closed for three weeks in a move aimed at avoiding the collapse of the country’s banking system.

Paying off the IMF and European Central Bank will give Greece some breathing space but the country will need bailout funds to meet upcoming debts.