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Greece delays IMF payment, sparking fears of a eurozone exit

The Greek government has announced that it will delay a scheduled payment of €300 million to the International Monetary Fund, raising fears that it may default and leave the eurozone. The money was due today, but the move is a legal one. Under IMF rules, Greece can bundle several payments into one bigger one, though no country has exercised that option since Zambia in the 1980s.

The background here is the breakdown in negotiations between Greece and its European creditors. When the financial crisis hit, Greece was unable to pay its creditors, and so accepted vicious austerity packages in return for a rescue from the IMF and the European Central Bank. This crushed the Greek economy, pushing unemployment over 25 percent and eventually leading to the election of the Syriza Party on an anti-austerity platform.

Now the Europeans are demanding further austerity in return for not kicking Greece out of the eurozone, while Syriza is demanding much less austerity so the Greek economy may recover. If they can't come to some arrangement, there may have to be new elections — or even an exit from the eurozone.