For one more time creditors sent a clear message to Greece: first the new deal will have to pass through the Parliament. Only then they will turn on the faucet and let 2 billion bailout tranche and 10 billion for the bank recapitalization flow towards the Eurozone south.
The Euro Working Group that is supposed to be on teleconference tomorrow, will send an e-card “To Greece with Love”, I dare predict.
Now Greece has to push things forwards and first of all to close the deal with creditors. Both sides held marathon-long negotiations over the weekend. I hear, they went to bed at 5 or 6 o’clock Monday morning after talking to each other for 17 hours. Later today they assumed the talks.
The most difficult issues to agree upon are apparently still the nonperforming private and business loans and the foreclosure of the first residence, while the notorious issues of the Value Added Tax and the Banks governance stand also there in form of stone obstacles that have to be mastered.
Finance Minister Euclid Tsakalotos and Economy Minister Giorgos Stathakis met with the creditors’ representatives again on Monday afternoon. they expressed optimism about the outcome. On the agenda: red loans and foreclosures.
According to Greek media, “the Greek government tries to establish a larger safety net for borrowers and wants the annual income criteria at €30,000 for a family of four. This threshold will protect 55-60% of the borrowers from losing their homes or see everything they own being be seized. On their side, creditors apparently want the protection threshold to be just 20,000 euro.
During the talks on Sunday, the government reportedly presented several proposals to protect the households that were meeting their obligations to a great extend but today they can not serve the mortgage installments due to the economic crisis and unemployment. The government intends to put a cap on the number of auctions that the banks can launch within a year.
As for the Value Added Tax disagreement… you don’t seriously want me to write about it, do you?
Greece and creditors have to strike the deal today, because of the celebrations for the Polytechnic School Anniversary tomorrow Tuesday. Be prepared for long marches tomorrow through downtown Athens.
The government must have voted on the deal – which will be a multi-bill in express procedures – by Thursday.