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Greece and lenders reach staff-level agreement on 3rd review

Greece and its lenders reached a staff-level agreement on the country’s third program review on Saturday, Finance Minister Euclid Tsakalotos said after a meeting with the country’s lenders.

“We achieved the agreement with the institutions on a staff-level on all issues,” he told journalists. “We won enough things and we are happy,” he said, citing as an example the agreement to give employees super priority in case of bankruptcy.

He said that they will be first in the list of creditors, above the banks and the State.

Asked about whether the VAT on the islands will remain unchanged, the minister said this issue “has not exactly been agreed on with the institutions” and remains pending. He said the issue will be clarified long before January 1, 2018 when the special tax regime will be abolished.

Government spokesman Dimitris Tzanakopoulos said on Sunday, that the staff level agreement does not contain any fiscal measure.


The European institutions (European Commission, European Central Bank and the European Stability Mechanism) announced in a joint statement on Saturday the achievement of a staff-level agreement with Greece on the third program review, saying Greek authorities have to implement the prior actions to conclude it.

“The European institutions have reached a staff-level agreement with the Greek authorities on the policy package supporting the ESM program. This will be presented to the Eurogroup next Monday 4 December 2017. The Greek authorities plan to implement the prior actions necessary to conclude the 3rd review as soon as possible,” they said in a statement.

The agreement is expected to be approved at the Eurogroup meeting, tomorrow, Monday.

Greece is expected to have fulfilled all the prerequisites before 22. January 2018 so that the Eurogroup and the lenders release the 55 billion euros bailout tranche.

The staff level agreement was reached in 5-day negotiations and was the most quiet and less speculative of the last eight years, since the country applied for the first bailout.

I am not in position to say that negotiations were smooth because 1. Schaueble is not finance minister anymore or 2. Germany is still struggling for form a government or 3. Greece simply accepts all lenders’ demands or 4. all the above.

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