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Eurogroup-Greece: Permanent Presence of Controllers, Constitution Amendment to Serve Loan Repayment

Greece is ‘saved’ by giving up some of its sovereignty by accepting a strong and permanent control mechanism, while a Constitution amendment will give priority to repayment of the loan. Instead of one powerful  state commissioner  many ‘little’ commissioners will be sent to Greece to monitor that the bailout terms are met. These conditions are stated very clear in the statement issued by the 17 euro zone finance ministers after they gave the green light for a second bailout worth 130 billion euro.

In particular:

1) The Eurogroup will strengthen the EU Task Force with a permanent presence in Athens. This Task Force will consist of experts from other member states. [They will start arriving by next week]

2) Strong monitoring of the measures that the Greek government will take.

3) Setting up a segregated account (escrow account). [ State revenues will gflow into this account].

4) Priority will be given to debt serving payments. This provision will be anchored in the Greek constitution as soon as possible.

5) The ‘haircut” of the Greek bonds (PSI) will have a nominal value of 53.5%. [ Greek debt will be trimmed by 107 billin euro]

“The Eurogroup is fully aware of the significant efforts already made by the Greek citizens but also underlines that further major efforts by the Greek society are needed to return the economy to a sustainable growth path.” (Irish Examiner)

Full Text of Eurogroup Statement Here

Friends at Last…

PS Some Greeks wonder that if the first bailout failed, why the second one would succeed… And some others claim that they are fed up to hear every two months “Greece is saved”.

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  1. “Priority will be given to debt serving payments. This provision will be anchored in the Greek constitution as soon as possible.”

    This is the killer. It was something that undermined the democratic revolutions in places like the Philippines in the wake of the world debt crisis of the 80s and 90s. On a smaller scale it is written into the Private Finance Initiative contracts in the public sector, prioritising, for example in the health sector, debt repayment over patient care. This is causing increasing problems at the moment.

    Of course they are saying that Greece is saved, what they mean is ‘the banks are saved’. Both are delusions unless there are serious attempts to reform monetary union and to begin an investment and reform programme for growth and development.

  2. Wow, thank God that’s over. Now we can start saving money. No need to spend money on elections because we have overseers. No need to waste money paying for all the ministers and their assorted ministries because we have outsiders giving us our allowances. Really the only cost to us is the homes they will occupy (without an emergency solidarity tax), the vehichles they will be driving(without paying import tax)they might even get gas coupons like foreigners did in the 1970’s, and of course that little thing called DEMOCRACY(changing the constitution with no referendum). As the picture shows everybodys happy. So what’s the problem? A**H*LES !!!!!!

  3. tststs… ugly words in KTG? oh Noooooo!

  4. I’m sorry to you KTG. My sorrow and hurt got the better of me. Please forgive me 🙁

  5. Does a constitution amendment require a popular by the people? Otherwise it is a joke (if only the Parliamentary is needed).

    On the bright side, a permanent 20 people Troika team will bring €1 million to the local Greek economy.

  6. Is in fact not a bad idea! Now all the foreign personnel is coming in. Send all ministers home and close all ministries and parliament. Let the creditors pay their salaries and pay for their housing. And as long as all the overseeing is going on, Greece will safe money and earn some.
    Better idea would be to send Greek politicians and civil servants in an exchange program to Germany, Netherlands and a couple of other countries and let them run those countries and economies for a while as they will run ours.
    Might even be a great idea for the parliamentarians. Big exchange program. Could even be a new reality TV-show!!! 😆

  7. I just wrote a post on the Constitutional amendments requierements.
    We’ll stick them in dark ministries rooms so they will not have time to spend a single cent.

  8. Exchange programme? great idea! Reality show “Be MP for a week?” Super idea!