Plan for new state debts is due next week

The final decisions on the new settlement scheme for debts created during the pandemic will be made late next week.

The staff-level talks with the creditors have been completed, Finance Minister Christos Staikouras told Skai Radio yesterday, adding that there was good cooperation between the two sides. As soon as there is an agreement with the creditors at the senior level, the new settlement will be announced to taxpayers so that they are aware of the precise terms and conditions that come with it, said Staikouras.

The Greek government has proposed to the creditors increasing the number of installments up to 72, from the existing 24 interest-free monthly tranches or 48 installments with an interest rate of 2.5%; it has also proposed the inclusion of debts from income tax and the Single Property Tax (ENFIA) created during the same period.

Asked about the possibility of a new lockdown, Staikouras was adamant: “The country cannot go back into lockdown. Vaccination is the shield for the protection of public health and the ticket for the return to normality.” That way the minister put an end to any scenarios about new support measures, stressing that lockdowns have an adverse effect on and come at a huge cost for the real economy, as well as public finances (deficit and debt).

Regarding the measure of subsidizing enterprises’ fixed expenditure, Staikouras said that while some applications have been turned down, those of more than 30,000 are being considered. In total over 74,000 corporations have applied.

The reasons for the rejections are that a number of them actually had an increase in turnover or a decline of less than 30% year-on-year. There were also cases where the subsidies requested were greater than the actual expenditure, while 550 applicant companies were not among the sectors deemed to have suffered from the lockdowns.

Among the likely recipients of the voucher toward their tax and social security obligations are 10,000 food service companies and 3,500 hotel enterprises.

Staikouras further referred to the course of the economy and stressed that even if there is pressure on the economy due to fears over the Delta variant, there are already are some positive indications that offset it, so the 3.6% growth target is realistic.