One question - you referred to their foreign debt.
Under a default there would be no foreign debt, therefore no debt payments need be made.
Unless someone invades them to clean out their treasury, if a sovereign state repudiates it's debts that's the end of it.
Yes they may find it difficult or nigh impossible to buy any imports but someone will always be prepared to sell them stuff and take a chance.
I'm not an economist but I expect within a short space of time they could re-employ lots of people in local manufacturing to produce most of the things they need to survive, and they could use their foreign exchange earnings from tourism to buy other imports ie cars, electronics etc that they couldnt manufacture themselves.
Very high risk stategy but going with the status quo and reading about all these so-called restructuring deals doesn't seem to be doing much constructive either.
