Finance Minister Euclid Tsakalotos is engaged in a sprint to tie up all loose ends in the current bailout programme, so as to open the way for a new, somewhat less strict supervisory framework by lenders.
It is hoped that this framework will be based on a Greek development plan, of which Athens can claim ownership, on the way to double European Parliament and general elections, in May, 2019.
Tsakalotos has made clear that Athens does not seek a precautionary credit line.
He also announced that pension cuts scheduled for 1 January, 2019, will go forward, as agreed with creditors, but that the government hopes to offset the losses with a handout, which he suggested could be a one-off 13th pension, for which the vast majority of pensioners will be eligible.
All that, of course, presupposes the steady, unswerving implementation of a reform and growth programme, which may be largely authored by the Greek government, but will be subject to the approval of creditors.
Like Prime Minister Alexis Tsipras, Tsakalotos rules out early elections, and says that they will be held near the end of the government’s current term.
The finance minister said that Syriza plans to run in the next general elections on a platform consisting of its own development plan, which will focus on stimulating employment and reducing certain taxes, especially for businesses but also for the middle class, all on condition that fiscal performance permits such measures.
Discussions regarding the day after the current programme have already begun with the new Eurogroup President, Mario Centeno, and the new Eurogroup Working Group chief, Hans Vijlbrief.
Hardliners want stricter fiscal oversight
The hardline Eurogroup members favour a future supervisory scheme that will be as strict as possible, so that Greece may meet its weighty responsibilities.
Some observers believe that Centeno, however, due to his experience with the Portuguese programme, may be more sympathetic towards Athens than his predecessor.
“No country can return to normalcy and attract investors while being subject to a memorandum,” Centeno has said.
Centeno favours Greek ownership of its own reform programme, but everyone remains concerned about whether and how Greece can stand on its feet again and when the reforms that have already been implemented will begin to yield palpable returns in the real economy.
‘Holistic’ reforms scheme in April
The Eurogroup is expecting a ‘holistic’, or comprehensive, strategic development plan, to be tabled by the Greek government in April. That plan will be the basis of a gentlemen’s agreement on a roadmap that will not displace the existing agreed upon fiscal targets, which run through 2022.
It is hoped that the Greek homegrown programme, along with debt restructuring measures by European creditors, will convince the IMF that the Greek debt is viable, as sustainable debt is the precondition for the Fund’s participation in the programme.
