International auditors are set to arrive in Greece to determine if the struggling country is eligible to receive $38 billion in aid. That amount is the last part of the $158 billion aid package granted about four months ago. Greece's economy is declining in a faster rate than predicted even if the country has drastically cut spending to reduce debt.
The international auditors, otherwise called the troika, comprise of the European Central Bank (ECB), European Commission (EC) and International Monetary Fund (IMF).
The IMF stated that "it was supporting Greece in overcoming its economic difficulties." But there are conflicting reports whether the IMF will grant Greece more time to pay their loans.
According to the BBC: "Greece has promised to reduce its budget deficit to below 3% of annual national income as measured in Gross Domestic Product (GDP) by the end of 2014. At the end of last year, Greece's overspend was equivalent to 9% of GDP in 2011. Successive Greek governments have managed to trim 17bn Euros from government spending. That has brought the country's total debt down from more than 160% of GDP to 132 percent."
The agreement between the troika and the Greece involves reducing the country's debt by 120% of GDP in eight years. Greece Prime Minister Antonis Samaras is pessimistic that their government will be able to achieve that by 2020 because of the increase of taxes and sales of assets. Greece is scheduled to pay the ECB $4.6 billion in August.
Economists predict that Greece will need $60 billion more to fully recover from their down economy.
If Greece is unable to recover from its financial situation, analysts expect the nation to revert back to using their pre-euro currency -- the drachma.
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