Troika clears fifth bailout tranche

Cred­i­tors call for strict im­ple­men­ta­tion of set of mea­sures agreed with Athens af­ter month­long talks

Kathimerini English - - Business & Finance -

Greece’s cred­i­tors are ex­pected to re­lease the fifth tranche of money from the 110-bil­lion-euro sup­port pack­age next month af­ter Euro­pean Com­mis­sion, Euro­pean Cen­tral Bank and In­ter­na­tional Mon­e­tary Fund rep­re­sen­ta­tives vis­it­ing Athens ex­pressed their sat­is­fac­tion with the coun­try’s progress, ac­cord­ing to a state­ment they re­leased yes­ter­day.

The Fi­nance Min­istry had con­firmed a few hours ear­lier that the month­long visit by the troika mis­sion to Athens has ended with an agree­ment with the Greek gov­ern- ment on a se­ries of re­forms that will likely be an­nounced early next week. They will concern the midterm fis­cal plan and the planned pri­va­ti­za­tions.

“The mis­sion has reached stafflevel agree­ment with the authorities on a set of eco­nomic and fi­nan­cial poli­cies needed to meet pro­gram ob­jec­tives. Strict im­ple­men­ta­tion of these will help to re­store fis­cal sus­tain­abil­ity, safe­guard fi­nan­cial sec­tor sta­bil­ity, and boost com­pet­i­tive­ness to cre­ate the con­di­tions for sus­tained growth and em­ploy­ment,” the troika state­ment sug­gested.

“Build­ing on the agreed com­pre­hen­sive pol­icy pack­age, dis­cus­sions on the fi­nanc­ing modal­i­ties for Greece’s eco­nomic pro­gram are ex­pected to take place over the next few weeks. Once this process is con­cluded and fol­low­ing ap­proval of the IMF’s Ex­ec­u­tive Board and the Eurogroup, the next tranche will be­come avail­able, most likely, in early July,” it added.

The troika sug­gested that sig­nif­i­cant progress has been made in the area of fis­cal con­sol­i­da­tion, al­though it noted more fis­cal and struc­tural re- forms are needed to re­duce the bud­get deficit and im­prove the busi­ness cli­mate.

The mis­sion rec­og­nized that the re­ces­sion last year was worse than an­tic­i­pated, but it ex­pects the econ­omy to sta­bi­lize at the turn of the year, iden­ti­fy­ing as en­cour­ag­ing signs the “notable pickup in ex­ports” and the de­clin­ing in­fla­tion.

“The gov­ern­ment has com­mit­ted to an am­bi­tious medium-term fis­cal strat­egy that will en­able it to main­tain its 2011 and medium-term fis­cal tar­gets. This strat­egy in­cludes a sig- nif­i­cant down­siz­ing of pub­lic sec­tor em­ploy­ment, re­struc­tur­ing or clo­sure of pub­lic en­ti­ties, and ra­tio­nal­iza­tion in en­ti­tle­ments, while pro­tect­ing vul­ner­a­ble groups,” it stated.

The troika also con­firmed that tax ex­emp­tions will be re­duced and prop­erty tax­a­tion will rise, with greater ef­forts to beat tax eva­sion. Athens will cre­ate a pri­va­ti­za­tion agency to be pro­fes­sion­ally and in­de­pen­dently man­aged, with quar­terly and an­nual tar­gets set aimed at re­al­iz­ing rev­enues of 50 bil­lion eu­ros by 2015, the state­ment noted.

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