Cer­tainty over ESM’s ap­proval

Board meet­ing to ap­prove to­day the dis­burse­ment of 7.7 bln eu­ros to Greece, as Athens pre­pares let­ter to IMF


A top eu­ro­zone of­fi­cial in Brus­sels and a se­nior Fi­nance Min­istry source in Athens ex­pressed cer­tainty yes­ter­day that the board of the Euro­pean Sta­bil­ity Mech­a­nism will is­sue its ap­proval to­day for the dis­burse­ment of the 7.7-bil­lion-euro tranche to Greece. Also to­day or in the next few days Athens will send a re­quest to the In- ter­na­tional Mon­e­tary Fund for it to par­tic­i­pate in the bailout pro­gram.

“I am cer­tain that in to­mor­row’s con­fer­ence call of the ESM board the is­sues that were open will be con­sid­ered ful­filled,” the eu­ro­zone of­fi­cial said yes­ter­day, adding that they are “small mat­ters that can be eas­ily ful­filled.” Like­wise the min­istry source noted they are de­tails of a tech­ni­cal na­ture that were set­tled yes­ter­day, one by one, via con­fer­ence call.

“I am not in­ter­ested in the possi- bil­i­ties of de­feat; they do not ex­ist,” the eu­ro­zone of­fi­cial said us­ing a quote at­trib­uted to Queen Vic­to­ria to show his cer­tainty of a pos­i­tive out­come to­day. Re­fer­ring to this com­ing Mon­day’s Eurogroup meet­ing, he laughed that “this will be the first Eurogroup after many meet­ings with­out Greece on its agenda.”

The min­istry source also said that very soon, pos­si­bly even to­day, the gov­ern­ment will send the IMF a let­ter of in­tent ask­ing the Fund to par­tici- pate in the Greek pro­gram. The let­ter will be signed by the prime min­is­ter, the fi­nance min­ster and the cen­tral bank chief. The IMF board will de­cide by July 27.

Ac­cord­ing to a doc­u­ment pub­lished by the ESM yes­ter­day the pre­cise date of the 7.7-bil­lion-euro dis­burse­ment re­mains open, with a dead­line set for July 31.

Greece is fac­ing nu­mer­ous large pay­ments in the next few weeks. In 10 days’ time it must pay 2 bil­lion eu- 843.25 +1.1385 ros to pri­vate bond­hold­ers, on July 18 290 mil­lion is due to the IMF and on July 20 Athens must pay 4 bil­lion eu­ros to the Euro­pean Cen­tral Bank.

Of that 7.7 bil­lion eu­ros, 6.9 bil­lion will be used for ser­vic­ing the state debt and 800 mil­lion will be placed in a sep­a­rate ac­count for the re­pay­ment of state dues to sup­pli­ers and tax­pay­ers – but only pro­vided that Greece has used 80 per­cent of the 1.8bil­lion-euro tranche paid last year to cover sim­i­lar dues to third par­ties.

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