Creditors return to Athens; Eurogroup paves the way for debt relief talks

Creditors return to Athens; Eurogroup paves the way for debt relief talks

Athens, March 8, 2016/ Independent Balkan News Agency

By Zacharias Petrou

Following a crucial Eurogroup meeting on Monday, President Jeroen Dijsselbloem said the top negotiators of Greece’s creditor institutions will return to Athens “possibly tomorrow” to complete the first review of the country’s bailout program.

The Eurogroup Ministers of Finance took stock of progress made by Greece in its reform and spending cuts drive and decided the high-ranking envoys of the quadriga of Greece’s creditors must return to Athens to continue a stalled review.

Finance Minister Euclid Tsakalotos confirmed that the heads of the institutions will return to Athens to complete the first program review, following a Eurogroup meeting in Brussels.

“The institutions agreed to return. The IMF also agreed to return, despite some differences,” he told journalists, noting that the meeting was “very good”.

“We expect further talks, to complete the first review in time […] I’m sure that when logical people sit around a table, they’ll find a logical solution,” he added.

The meeting proved very important on another front too, as it paved the way for debt relief talks to begin.

Greek Prime Minister Alexis Tsipras welcomed statements by the Eurogroup according to which Greek debt relief talks will start as soon as the first program review has concluded.

“We welcome the Eurogroup’s commitment to proceed with debt relief as soon as the review of the program is completed,” Tsipras tweeted on his official account.

Speaking after the meeting, Eurogroup chief Jeroen Dijsselbloem said preparation at technical level has been satisfactory but that more work needs to be done to complete the review. He revealed that there are “fiscal gaps” that need to be bridged and reforms that must go deeper.

On his part, European Commissioner for Economic and Financial Affairs, Pierre Moscovici, pointed out that there is much work to be done on the following issues: the operation of the new Greek privatization fund, tax reform and social security reform, the creation of an independent authority for public revenues and resolving the problem of non-performing loans.

Clarifying fiscal targets, Moscovici said that Greece will have to achieve a primary surplus of 3.5 pct of GDP in 2018. “We will work together to agree on the measures which will lead us to the achievement of this goal,” he said, adding that the program review could be wrapped up before the Orthodox Easter on May 1.

The managing director of the European Stability Mechanism (ESM), Klaus Regling, said ESM representatives will visit Athens on Tuesday and stressed the need to complete the review soon, noting that the liquidity margins of the Greek economy are tight and that the country must avoid falling into arrears.

Meanwhile, the Greek government is preparing to table a series of draft bills to parliament, using the emergency procedure – a method Syriza highly criticized when previous government resorted to it. The aim is for tough, unpopular reforms (such as taxation, pensions, etc.) to be followed by partial implementation of the government’s “parallel program” which would make it easier for MPs to “sell” to their constituencies. Draft bills being currently prepared include: Research Funding and Measures to avert a “brain drain”, undeclared income, electronic financial transactions, boosting investment, tax reform, social security reform, dealing with non-performing loans, etc.