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Greece Is the Only Developed Country that Defaults on the IMF

(L-R) International Monetary Fund Managing Director Dominique Strauss-Kahn, United States Secretary of the Treasury Timothy Geithner, French Minister of Economic Affairs, Industry and Employment Christine Lagarde, and Spanish Second Vice President and Minister of Economy and Finance Elena Salgado have a discussion after a group photograph prior to the start of the Development Committee meeting at the 2010 IMF/World Bank Spring Meetings at International Monetary Fund Headquarters (IMF),  April 25, 2010 in Washington, D.C. IMF Staff Photographer/Michael Spilotro
After defaulting on its payment to the International Monetary Fund (IMF) at 1:00 am on Wednesday, Greece became the first developed country that failed to meet its financial obligations to the Fund.
Greece has officially joined Zimbabwe, Somalia and war-torn Sudan as one of the countries that defaulted to the IMF. It is also the first Eurozone country that has done so.
Greece’s inability to pay the 1.53-billion-euro loan tranche due to the fund on June 30 generated reactions in Europe and the U.S. However, Greece is not officially bankrupt. The payment is not considered overdue at least until Monday.
The IMF procedure dictates that the Managing Director must officially notify the Board of Directors within a month. Christine Lagarde will do so immediately, according to reports.
After the Board is notified, Greece will be given a 30-day period to settle the payment. However, the country will be charged interest on late payments and is threatened to lose its voting right in the Fund.
The IMF has the right to expel Greece only if the country fails to make the payment after 24 months.

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