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| Creditors to audit Greek progress on debt reduction | Creditors to audit Greek progress on debt reduction |
| (40 minutes later) | |
| Representatives from the troika of international lenders arrive in Greece on Tuesday to assess its progress towards reducing its huge debts. | Representatives from the troika of international lenders arrive in Greece on Tuesday to assess its progress towards reducing its huge debts. |
| They must decide whether Greece is eligible to receive 31.5bn euros - the last tranche of a 130bn euro ($158bn, £102bn) aid package agreed in March. | They must decide whether Greece is eligible to receive 31.5bn euros - the last tranche of a 130bn euro ($158bn, £102bn) aid package agreed in March. |
| Athens is behind in its plans to cut spending and debt because its economy is shrinking faster than forecast. | Athens is behind in its plans to cut spending and debt because its economy is shrinking faster than forecast. |
| The Greek prime minister is expected to ask for more time to repay its loans. | The Greek prime minister is expected to ask for more time to repay its loans. |
| The International Monetary Fund (IMF), European Central Bank (ECB) and European Commission (EC) make up the troika. | The International Monetary Fund (IMF), European Central Bank (ECB) and European Commission (EC) make up the troika. |
| The IMF said it was "supporting Greece in overcoming its economic difficulties" and would work with the country to get it "back on track". | The IMF said it was "supporting Greece in overcoming its economic difficulties" and would work with the country to get it "back on track". |
| However, reports over the weekend suggested that the IMF would refuse calls for further aid. | However, reports over the weekend suggested that the IMF would refuse calls for further aid. |
| Extra 50bn euros | |
| Greece has promised to reduce its budget deficit 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. | Greece has promised to reduce its budget deficit 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. |
| Crisis jargon buster Use the dropdown for easy-to-understand explanations of key financial terms: AAA-rating The best credit rating that can be given to a borrower's debts, indicating that the risk of borrowing defaulting is minuscule. Glossary in full | |
| 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% according to official figures released on Monday. | 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% according to official figures released on Monday. |
| Under the terms of its international loan agreement with the troika, Greece has vowed to reduce its total debt to 120% of GDP by 2020. | Under the terms of its international loan agreement with the troika, Greece has vowed to reduce its total debt to 120% of GDP by 2020. |
| But, Prime Minister Antonis Samaras would have had to have raised another 12bn euros through higher taxes and the sale of public assets such as the country's loss-making railways to have met this bailout target. | But, Prime Minister Antonis Samaras would have had to have raised another 12bn euros through higher taxes and the sale of public assets such as the country's loss-making railways to have met this bailout target. |
| Still worse, Greece's economy is shrinking faster than most had forecast. The Bank of Greece expects GDP to shrink 5% this year in its deepest recession since the 1930s. | Still worse, Greece's economy is shrinking faster than most had forecast. The Bank of Greece expects GDP to shrink 5% this year in its deepest recession since the 1930s. |
| As a result, economists calculate that Greece may need a third rescue package worth up to 50bn euros. | As a result, economists calculate that Greece may need a third rescue package worth up to 50bn euros. |
| August debt payment | August debt payment |
| The re-run of general elections and political instability as parties scrambled to form a governing coalition has delayed work by the troika and the government to agree a credible plan to restore the nation's finances. | The re-run of general elections and political instability as parties scrambled to form a governing coalition has delayed work by the troika and the government to agree a credible plan to restore the nation's finances. |
| A European Commission spokesman said the troika would not be in a position to report its findings and release the final 31.5bn euro instalment of bailout money until September. | A European Commission spokesman said the troika would not be in a position to report its findings and release the final 31.5bn euro instalment of bailout money until September. |
| "The Commission is confident that the decision on the next disbursement will be taken in the near future, although it is unlikely to happen before September," he said. | "The Commission is confident that the decision on the next disbursement will be taken in the near future, although it is unlikely to happen before September," he said. |
| That leaves Greece in a difficult situation. A 3.8bn euro debt repayment to the ECB falls due on 20 August. Without the troika money, the ECB may be forced to step in to provide temporary aid. | That leaves Greece in a difficult situation. A 3.8bn euro debt repayment to the ECB falls due on 20 August. Without the troika money, the ECB may be forced to step in to provide temporary aid. |
| But further debt repayments are due in September so failure to secure the bailout money could push Greece to the brink of insolvency. | But further debt repayments are due in September so failure to secure the bailout money could push Greece to the brink of insolvency. |
| If Greece were to default on its outstanding loans that, in turn, could force it to exit the eurozone and return to the drachma. | If Greece were to default on its outstanding loans that, in turn, could force it to exit the eurozone and return to the drachma. |