Following the Greek election results the left wing party Syriza is trying
to form an alternative coalition government. This appears unlikely to happen.
However, If this were to succeed and there was a rejection of the
austerity measures already agreed to reduce the country's deficit in exchange
for international support, it would leave its bailout in jeopardy.
The rest of the Eurozone and the International Monetary Fund, who
pledged bailouts worth a total of 240bn Euros (£190bn; $310). would
have to decide if the bailout would continue. If not, Greece could conceivably
end up leaving the euro.
In many ways the Greek crisis is a metaphor for our times. A customer develops a pattern of late payments but far from being called to order the supplier fearful of alienating the customer allows this to become the norm.
When the inevitable tipping point is reached there is no alternative to continue to support the errant buyer or risk realise a loss.
There is a growing realisation that the problem is just being kicked down the road.
However as the international banking community prepares for another serious blow to its capital structure the UK banking community will not be immune. At the very least there will be a renewed focus on exposure and this will impact on their willingness to lend.
Now more than ever businesses must demonstrate that they have full control over all aspects of their operations. Reporting procedures must be strictly observed and any potential problem areas or customers brought quickly into line. As it becomes harder to borrow, positive cash-flow is critical.
In many ways the Greek crisis is a metaphor for our times. A customer develops a pattern of late payments but far from being called to order the supplier fearful of alienating the customer allows this to become the norm.
When the inevitable tipping point is reached there is no alternative to continue to support the errant buyer or risk realise a loss.
There is a growing realisation that the problem is just being kicked down the road.
However as the international banking community prepares for another serious blow to its capital structure the UK banking community will not be immune. At the very least there will be a renewed focus on exposure and this will impact on their willingness to lend.
Now more than ever businesses must demonstrate that they have full control over all aspects of their operations. Reporting procedures must be strictly observed and any potential problem areas or customers brought quickly into line. As it becomes harder to borrow, positive cash-flow is critical.
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