No glitch in negotiations with troika officials, Greek government says

No glitch in negotiations with troika officials, Greek government says


By Lefteris Yallouros – Athens

Greek government sources have denied the troika has put off a visit to Athens on Monday to negotiate progress in the country’s adjustment program and finalize the approval of the disbursement of the next tranche of Greece’s rescue loan.

Reuters reported Thursday – citing statements by Eurozone officials – that troika inspectors put the trip on hold because they were unable to bridge differences with Greece over how to close a 2 billion euro ($2.7 billion) hole in its 2014 budget.

The Greek Finance Ministry reportedly says the visit will go ahead as planned with meeting having been set up already between the troika officials and representatives of Greece’s Finance, Labor, Development and Health ministries as well as with officials of the National Bank of Greece.

Negotiations are set to focus on the future of state-run LARCO, Hellenic Vehicle Industry and Hellenic Defence Systems as well as the privatization of water companies EYDAP and EYATH.

A target to put 12,500 civil servants in a “mobility scheme” of forced transfers or dismissals and fire another 4,000 by the end of the year will also be discussed.

These prior actions should have been implemented by the end of September in order for Athens to qualify for its next scheduled bailout instalment of over 1 billion euros.

The Greek government will hope to convince the troika that a primary surplus of 1.6 percent of gross domestic product (GDP) for next year will be reached while its funding needs for 2014 will be around EUR 500 million rather than the 2 billion predicted by the Troika.

However, as the Greek parliament’s budget office, revealed in a report on Thursday, “it remains open whether Greece next year will achieve a ‘primary budget surplus’, such as the one agreed in the medium-term bailout plan.”

Predictions such as this are cited in parts of the Greek press claiming that Antonis Samaras has made an error of strategy in opting to publicly oppose the implementation of horizontal measures of austerity which may be unavoidable after all.

The government will hope than the troika officials could be convinced to agree on “targeted” spending cuts and “structural measures” to plug any fiscal gaps.