The governor of Bank of Greece, Yannis Stournaras, revealed on Friday that he intends to recommend a complete lifting of capital controls. Stournaras made the statement after a meeting Prime Minister Kyriakos Mitsotakis.
During their meeting on Friday, the prime minister and central banker discussed broader developments in the Greek economy and the financial system.
Citing sources, state news agency amna, writes that Mitsotakis and Stournas emphasized the upbeat forecasts of international financial markets about the Greek economy’s prospects under the new government, as reflected in an improved cost of borrowing for the Greek state and the confidence shown by investors in the bonds issued by Greek systemic banks, such as Piraeus Bank and National Bank of Greece.
With regards to the financial system, Stournaras said that “all the weapons are on the table” and that Greece needed fiscal space to carry out reforms.
The central banker said that the primary surplus was currently at 2.9 pct, short of the 3.5 pct target, but appeared confident that the target can be met by boosting growth. With respect to non-performing loans, he said that both proposals submitted can be implemented
Stournaras also commented that he was “exceptionally happy to visit the Maximos Mansion again after 3.5 years.
Stournaras and former prime minister Alexis Tsipras were at odds with the latter considering that the BoG governor was undermining the government progress in economy.
PS As if the SYRIZA government would not have fully lifted the capital controls if it could.
On Jan 8, 2019, then finance minister Euclid Tsakalotos expressed optimism that capital control restrictions will be fully lifted by end of 2019. “Every two months I sign a paper that lifts some restrictions,” he said adding “as long as deposits return to the banks, the bigger is the lifting of capital controls.”
