Defusing Greek crisis would require creditors to change mindset

THE eurozone's long-running Greek crisis - now in its sixth year - is approaching its moment of truth. At the end of June, the European Union's (EU) bailout programme expires and Greece faces a set of repayments to the International Monetary Fund (IMF) totalling 1.5 billion euros (S$2.23 billion).

If there is to be another bailout, or an extension, there must be an agreement between Greece and the so-called "troika" - the European Commission, the European Central Bank (ECB) and the IMF - as well as additional funding. As of now, no agreement is in sight.

The latest draft submitted by Greece's creditors earlier this month was dismissed by Greek Prime Minister Alexis Tsipras as "absurd". Greece's submissions have also not been found acceptable. If there is no agreement, the spectre looms of capital controls by Greece, a possible collapse of its banking system, large defaults to multiple creditors including the ECB and the IMF and, in extremis, Greece exiting the eurozone - the so-called "Grexit" scenario.