Privatization of Greek water companies put off

Privatization of Greek water companies put off

 

By Lefteris Yallouros – Athens

Greek Prime Minister Antonis Samaras chaired a meeting with deputy PM Evangelos Venizelos and Finance Minister Gikas Hardouvelis Monday in which the government’s privatization program was discussed amongst other issues.

Briefing reporters on the outcome of the meeting, Venizelos revealed water companies EYDAP and EYATH will remain under state control, in line with a top court decision. “We are obligated to respect the ruling of the Council of State” Venizelos said.

Plans to privatize the Athens Water and Sewage Company (EYDAP) and Thessaloniki’s water board (EYATH) came under fire by opposition parties; opinion polls around the European Parliament elections also showed the privatization was unpopular amongst the majority of Greeks.

Last May Greece’s top court, the Council of State, has ruled the privatization plan of EYDAP to be unconstitutional. Specifically, the court ruled the government plan to contradict two articles of the Greek Constitution catering for the provision of public health on behalf of the state and the right of citizens to protection of their health.

The Hellenic Asset Development Fund which holds 74 pct of Athens – listed “Thessaloniki Water Supply & Sewerage SA” (EYATH) share capital had already begun the privatization process for the sale of 51 pct of the company’s shares and the transfer of control of the company to an investor through an international tender.

Following the court ruling, the decision to privatize EYATH was re-considered.

Troika auditors, currently locked in talks in Athens with the Greek government, are expected to request the gap created by the postponement of the privatizations is filled by different arrangements.

Finance Minister Gikas Hardouvelis held a 3.5 hour-long meeting with the representatives of the troika which focused mainly on the delays in the privatization program and downwards revisions of yearly targets.

Troika auditors will have further back-to-back meetings with Greek officials and cabinet ministers at the finance ministry on Tuesday, speeding up talks with the Greek government ahead of their scheduled departure on Thursday. With the Greek government largely on track to hit set fiscal targets having kept well within the state budget, the troika is expected to be rather lax on its scrutiny of the adjustment program.

“A political negotiation is always restricted by technical requirements,” Venizelos told reporters on Monday, hinting that a more long-term approach was necessary. So far, troika inspectors seem to have adhered to calls for leniency as a more pressing review of the Greek economy is expected to go ahead in September.