Government hastens final reforms before 6.7 bn euro tranche

The government is racing to implement the final remaining measures agreed to with creditors, after the Eurogroup yesterday approved a 6.7 billion euro loan tranche, on condition that the few outstanding commitment are met.

“The fourth tranche under the ESM programme amounting to EUR 6.7 bn will be disbursed to Greece in two disbursements, starting with a first disbursement in February of EUR 5.7 bn to cover debt servicing needs, to allow the further clearance of arrears and to support the build-up of the cash buffer of the Greek State, in order to support Greece’s return to the market, the Eurogroup said in a statement.

The remaining one billion euros for the government to cover arrears will be approved in the spring, following a review, which will emphasize auctions of seized real estate.

The Eurogroup also called on the government to devise a comprehensive growth strategy well before the end of the programme in August.

“The subsequent disbursement for arrears clearance may be approved by the EWG in Spring, subject to a positive reporting by the European Institutions on the clearance of net arrears using also own resources and a confirmation from the European institutions that the unimpeded flow of e-auctions has continued,” the statement read.

Greece’s eurozone partners lavished praise on the government for the completion of a series of reforms.

“Greek authorities have over-achieved the fiscal targets set over the last three years (2015-2017)… have also continued to strengthen tax collection through the Independent Authority of Public Revenue and enhanced the fairness and effectiveness of the social welfare system. The business environment has been improved by further actions aimed at opening up regulated professions, improving the investment licensing system, lifting regulations that unnecessarily restrict competition in product markets as well as the opening-up the energy markets,” they concluded.

Pierre Moscovici, the European Commissioner for Finance, praised Greece’s performance and expressed certitude that the final commitments will be met.

Klaus Regling, the Managing Director of the European Stability mechanism, and Eurogroup President Mario Centeno also praised Athens’ progress and encouraged continued reforms.