Inspection time for Greece

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Inspection time for Greece

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The moment of truth is approaching for Greece as the inspectors who have to agree that the government is doing enough to cut its debts arrived back in Athens.

The team from the European Union, the International Monetary Fund and the European Central Bank had threatened to cut off aid if the Greeks did not move faster to implement their massive austerity programme.

But there could be yet another stumbling block with Germany suggesting the bailout may have to be renegotiated depending on what the inspectors find.

If Greece does not get the money it will not be able to pay back what it has borrowed.

French banks are owed 42 billion euros, Germany’s 18 billion, Britain’s 10 billion and even lenders in Portugal — which has its own debt problems — have bought 740 million euros worth of Greek government bonds.

If the “troika” inspectors approve Athens new austerity drive they will sign off on the next part of the loan from the EU, IMF and ECB. That is eight billion euros which Greece needs to pay bills and salaries in October.

“I can confirm the Eurogroup (of euro zone ministers) will hold an additional meeting as soon as possible, still in October, to discuss the situation of Greece and consider the disbursement of the next tranche,” a European Commission spokesman said in Brussels, announcing the troika’s return.

Meanwhile German Chancellor Angela Merkel has suggested that parts of a planned new 109-billion-euro rescue for the debt-laden country could be reopened, depending on the outcome of the inspector’s audit.

“We have to wait and see what the troika … finds and what it will tell us (whether) we will have to renegotiate or not,” she told Greek state television NET, without elaborating.