Gov’t plan B for cash is un­der way

Kathimerini English - - Focus - EIRINI CHRYSSOLORA

It ap­pears the state is be­ing par­tic­u­larly con­ser­va­tive with its spend­ing and is draw­ing as much draw­ing liq­uid­ity as it can from the broader pub­lic sec­tor in case the ne­go­ti­a­tions with the coun­try’s cred­i­tors drag on for too long without the dis­burse­ment of a bailout in­stall­ment. How­ever, the state is si­phon­ing off pre­cious cash that would other­wise go to the mar­ket, whose re­serves are rapidly run­ning out, putting the re­cov­ery of the econ­omy at risk.

Bank sources say that 1 bil­lion eu­ros in new ex­pired debts to pri­vate par­ties have been added to the ex­ist­ing amount since the start of the year, while another bil­lion could be added by June. The lat­est Fi­nance Min­istry fig­ures show that in Jan­uary alone ex­pired debts rose by 300 mil­lion eu­ros to reach 3.6 bil­lion.

In the last few months of 2016 there was a de­cline in state ar­rears as Athens re­ceived a bailout tranche of 1.8 bil­lion to pay off its debts to sup­pli­ers and tax­pay­ers.

The bank sources added that re­pur­chase agree­ments could be in­creased by 3 bil­lion on top of the ex­ist­ing 11 bil­lion eu­ros, up to the sum of 14 bil­lion. There­fore, the state could in­crease its liq­uid­ity by 4 bil­lion (from debts to be cre­ated by June and more re­pos) in the com­ing months as a plan B ahead of the 7.4bil­lion-euro state debt pay­ment due in July.

A new 25-kilo­me­ter stretch of the Athens-Thes­sa­loniki na­tional road will open to traf­fic at Tempe, north of Larissa, from early April – in time for Easter. The project fea­tures three state-of-the-art twin tun­nels that by­pass parts of the val­ley where the high­way has re­peat­edly been closed due to land­slides.

The state is cre­at­ing fresh debts as Fi­nance Min­is­ter Eu­clid Tsakalo­tos knows the re­view talks may drag on.

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