The Minister of Finance Euclid Tsakalotos sent a letter to the President of the Eurogroup Jeroen Dijsselbloem last week.
In the letter, the Finance Minister explains that “Greek authorities remain fully committed to pursue the agreed fiscal path that is based on primary surplus targets of 0.5, 1.75 and 3.5 percent of GDP in 2016, 2017 and 2018 respectively”, adding that the contingency fiscal mechanism will be activated, in case these targets are not met.
Furthermore Mr. Tsakalotos recognizes that “that measures with fiscal implications need to be discussed and agreed with the institutions in line with our MoU commitments” and continues to note that “available fiscal space may be used on targeted measures to strengthen social protection (especially the Social Solidarity Income Programme) and/or to reduce tax burdens subject to MoU commitments. Otherwise, we will use the over-performance to build cash buffers and/or clear arrears”.
