Vladimir Putin’s Russia has enough problems of its own but will demand a warm weather port from Greece and will want a stake in Greek banks and other assets before giving the Greeks a penny. If Greece defaulted on a Russian loan, there would be no second chances, and Russia would probably simply sequestrate the entire country, until the entire debt was paid.
Dr Alf is right to suggest that Greece is playing a dangerous game. As things stand, the EU is probably hardening towards not paying “Danegeld” to Greece. By ‘doing nothing’ Greece will financially implode. Many people in Northern Europe are questioning the wisdom of granting Greece more loans if Greece is not prepared to deliver structural reforms.
Last time the Greeks defaulted, the Germans helped Greece as did China, in exchange for a Greek island which they will no doubt turn into a warm weather port for themselves and their blue water fleet. Providing Russia with such facilities is not a smart move strategically for Greece nor for the West.
Ahead of a formal default, there would probably be a grey period, with the government issuing IOUs to public sector workers and other ‘Mickey Mouse’ national accounting – perhaps then, Greece’s citizens will start to see their government differently? Creditors would prefer a Greek regime more capable of sorting out the economy, preferably without more bailouts and threats.