Greek Finance Minister Stournaras to Meet Eurogroup Inquisition

Posted by in Economy

 Greek Finance Minister Yiannis Stournaras is getting ready to take a seat at the bench of the Eurogroup Inquisition on Monday afternoon in Brussels. In his first appearance at the Euro Zone ministers’ council, Stournaras will be exposed to immense pressure as his EZ colleagues will wave the bailout-installment of 31.5 billion euro right in front of his face. The threat would be more than clear and the usual since Greece sought the financial aid of international lenders: “There will be no further cash disbursement to Greece until euro zone ministers determine that the conditions tied to its rescue programme are being met” the  -also- usual anonymous EU official told Reuters last week. Bailout-tranche would be in “pending status” until  Greece gets back on track in implementing the Memorandum of Understanding terms and conditions.

The Troika that visited Athens last week is not content about the content of its findings. No progress was made in the last three months. Obviously, as the country had no government. It is customary that the Greek state halts its activities before every election. Why? Ask the state policy-makers… Or better say: there is no state policy in Greece but government policies. Changing every time a party winds the elections – unfortunately.

The representatives of IMF/EU/ECB left Athens quite disappointed, but not surprised. The Troika went to Brussels to brief the Eurogroup about its findings and promised to come back to Athens two weeks later. Until then, Greece would have to have proceeded to concrete examples of the implementation of its commitments to its lenders.”

This Monday in Brussels, the Eurogroup ministers would remind Stournaras of the one-hundred measures Greece had promised to implement but did not do so far.

Among them are: 12-15% cuts in the wages of the so-called “specific wages rates” like Armed Forces personnel; further cuts in health costs; new tax law that won’t bring revenues decrease; privatizations; public sector trimming and closed professions.

That is the same old issues we have been discussing since May 2010…

“Ministers will discuss the findings of the “troika” of the European Union, the European Central Bank and International Monetary Fund from their first mission to Greece since the June 17 election. Another mission is due to return later in July.

Greece΄s new Finance Minister Yannis Stournaras said on Thursday he had been warned to expect a tough time at the Eurogroup, having acknowledged Athens was off course on its pledges linked to a 130-billion-euro rescue.

One senior euro zone official said the Eurogroup needed to see that Athens is getting back on track before it can hand over more aid, even if the previous Greek government said the administration risked running out of money by the end of July.

Greece΄s Prime Minister Antonis Samaras wants to ease the terms of the bailout, but that would mean more money for Athens.

“Even if the second program as it stands were fully implemented, it is not clear that market access could resume (in 2015),” said David Mackie, an economist at JP Morgan. “A third program seems likely in any event.” (Reuters via Capital.gr)

What is kind of calming is that Greece’s lenders would give a period of 100-day mercy period for the new Greek government.

Of course, major Inquisitor Germany is threatening again. This time it was Economy Minister Philipp Roesler  (FDP) who warned the Greeks saying ” I am running out of patience.”

PS Much to my knowledge, FDP-officials are running out of patience about Roesler – even if for different reasons :)