Euro zone lenders, Greece make progress on tax, pen­sion re­forms

The Pak Banker - - MARKETS/SPORTS -

Euro­pean lenders have made im­por­tant progress in talks with Greece on tax and pen­sion re­forms that are part of a pack­age of mea­sures Athens must adopt to win new loans and debt re­lief, a Euro­pean Com­mis­sion spokesper­son said on Sun­day.

In­spec­tors from the Euro­pean Com­mi­sion, the Euro­pean Cen­tral Bank and the In­ter­na­tional Mon­e­tary Fund as­sess­ing Greece's progress on re­forms left Athens on Sun­day, tak­ing a break for the Catholic Easter hol­i­days. "The mis­sion has been pro­duc­tive. Sig­nif­i­cant progress has been made on the in­come tax re­form," the spokesper­son said. "The mis­sion made im­por­tant progress on key aspects of the pen­sion re­form. Work is on­go­ing and will con­tinue over the Easter break.

The mis­sion chiefs will re­turn to Athens on April 2 to re­sume the dis­cus­sions with a view to con­clude them as soon as pos­si­ble," the spokesper­son said.

Greek Prime Min­is­ter Alexis Tsipras wants to wrap up the re­form re­view quickly to clear the way for talks on debt re­lief, help re­store con­fi­dence in the coun­try's econ­omy and per­suade the Greek peo­ple that their sac­ri­fices over six years of aus­ter­ity are pay­ing off.

But the talks have dragged on for months due to dis­agree­ments over fis­cal tar­gets, pen­sion cuts and tax re­forms be­tween Athens and its Euro­pean Union and IMF lenders and among the EU and IMF in­sti­tu­tions them­selves.

The fo­cus is on ways to cover an es­ti­mated fis­cal gap of 3 per­cent of GDP by 2018. Ac­cord­ing to sources close to the talks EU lenders have been more le­nient dur­ing the re­view than the IMF, which has said that Greece will need far big­ger debt re­lief than euro zone part­ners have been pre­pared to en­vis­age.

A meet­ing of euro zone fi­nance min­is­ters in April will be cru­cial for Greece, which is also deal­ing with a huge mi­grant cri­sis. The govern­ment, which has a par­lia­men­tary ma­jor­ity of just three seats, has pledged to trim its pen­sion bud­get by 1 per­cent of GDP this year. But it wants to avoid cut­ting pen­sions for the 12th time since 2010 to plug the es­ti­mated fis­cal hole.

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