European Stability Mechanism (ESM) chief Klaus Regling has urged the Greek government to complete all remaining prior actions and decisively implement agreed reforms, in order to successfully exit its bailout program in August 2018.
Regling said he is confident Greece can repay it sovereign debt, providing repayment doesn’t exceed 15-20% of GDP on an annual basis.
The ESM chief also praised the progress the Greek government has made so far, noting that the debt relief could follow a decision to wrap up the 4th and final review of the program.
Commenting on the effort to reform the Greek economy and put it on track to recovery, Regling was heavily critical of the first SYRIZA government. According to the ESM chief, the government’s moves at the time cost the economy billions of euros and set the country back in terms of its effort to exit its adjustment program.
In recent years, however, Greece’s creditors have become far more appeased as the country’s government has successfully concluded the reviews of the bailout program and shown commitment to see through reforms.
Finance Minister Euclid Tsakalotos recently presented a “holistic” master plan for growth to Eurogroup counterparts.
Meanwhile, in its latest report, the Parliamentary Budget Office called for a minimum consensus on a long-term strategic plan that would exceed the mandate of one government.
“A reliable commitment that past practices will not be repeated is required,” the Office said. It also forecast that Greek GDP will expand by 2.3% this year.
Business expectations in the industrial sector also appeared to improve in April. According to the Foundation for Economic and Industrial Research (IOBE), this development is in line with a recovery of economic climate in Greece, as reflected by an increase in almost all business sectors of the economy and in consumer confidence…. / IBNA