The review not quite finished yet

28 May 2016
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The government has just four days to make changes required by the country’s creditors to the laws voted on in the last few weeks in order for the first review of Greece’s third bailout to be definitively concluded and the process for the disbursement of the sub-tranche of 7.5 billion euros to Athens to begin. Finance Minister Euclid Tsakalotos appeared relatively optimistic on Friday about the outcome of the negotiations.

Athens and its creditors are in constant communication in a bid to close all the open issues in time. The aim is for everything to have been approved by June 1 for the sub-tranche to be released within next month.

Alternate Finance Minister Giorgos Houliarakis admitted the requirements include several “technical improvements” to the laws, with competent officials saying that in some cases this only concerns changes to some of the laws’ wording.

Sources say that the creditors have asked for 15 amendments, which has produced a strong reaction from the government. Greek officials say that the changes requested are too many, and several of them are rather insignificant.

Crucially, the 15-point list that the creditors have sent to Athens includes not only the return of retroactive payments of the EKAS benefit to pensioners – for which no solution has been found yet – but also the issue of the sale of loans guaranteed by the state. Tsakalotos admitted yesterday that there is a risk that because of that issue Athens may be asked to pass another package of austerity measures adding up to as much as 1.5 billion euros, which even the creditors would rather avoid.

Once all the amendments are in place, the creditors will draft their Compliance Report for the completion of the review. Then certain national parliaments in the eurozone will have to approve the disbursement of the sub-tranche, including those of Germany and the Netherlands, before the European Stability Mechanism sets off the procedure for the payment of the 7.5 billion euros. Estimated see this taking some three weeks, and Finance Ministry officials say that in order to avoid any serious cash problems the process must be completed by end-June.

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