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Greece confident to get fourth EU/IMF aid tranche
Sun Feb 6, 2011 10:38am EST
* EU, IMF, ECB officials start inspection visit Monday
* Talks to focus on budget, labour, pension reforms
* EU examines options to help Greece tackle debt
By Angeliki Koutantou and Ingrid Melander
ATHENS, Feb 6 (Reuters) - Greece is confident it has made enough progress on its fiscal consolidation plan to get the green light this week for a fourth tranche of EU/IMF aid, a government official said ahead of an inspection visit.
International Monetary Fund and European Union officials start talks on Monday to evaluate whether the country has met fourth-quarter targets under the bailout plan that saved it from bankruptcy in May and qualifies for the next, 15 billion euro ($20.4 billion) aid instalment.
"The (aid) tranche is secured," said the finance ministry official, who declined to be named.
Greece has cut public sector wages, frozen pensions, raised taxes and started reforms to open up its economy to more competition, as agreed with the European Union and the International Monetary Fund last year in return for the 110 billion euro bailout.
Its central government budget deficit shrank more than targeted last year, the finance ministry said, mainly due to expenditure cuts, meeting an important target.
But its lenders said during their last visit in November that Greece was bound to have missed its general government deficit target, which also includes local authority spending and is a key benchmark for the EU's assessment of the programme -- partly because of a revision of 2009 fiscal data.
UNDER PRESSURE
Preliminary talks last week showed the 2010 general government deficit will be broadly in line with the 9.6 percent of GDP estimated by the EU and IMF in November, versus an initial target of about 8 percent, a source close to the proceedings said.
Greece is set to come under pressure this week from the European Commission, ECB and IMF officials -- dubbed the troika -- to do more to implement reforms as part of efforts to make further savings in 2012-2014 and catch up on 2010 shortfalls, another government official said.
"We are expecting the troika officials to ask us to speed up privatisations and the major reforms", the official said.
Greek media reports suggested on Sunday that the debt-stricken nation might be asked to put more effort into cutting labour costs, including in the private sector, to boost its competitiveness.
EU and IMF officials were satisfied with preparatory talks last week over pension reform, with the first findings of an actuarial study showing last year's shake-up of the system was on track to achieve its targets, officials said.
More talks will be needed, however, on the myriad of supplementary funds, they said.
The visit takes place as the EU examines options to help Greece tackle its debt mountain, including an extension of bailout repayments or a possible debt buy-back plan, as part of an overall deal the bloc seeks to agree in March to draw a line under the crisis and stop its contagion.
The chairman of euro zone finance ministers Jean-Claude Juncker will be in Athens Tuesday for talks with the government.
***
Tutto procede regolarmente.
Sun Feb 6, 2011 10:38am EST
* EU, IMF, ECB officials start inspection visit Monday
* Talks to focus on budget, labour, pension reforms
* EU examines options to help Greece tackle debt
By Angeliki Koutantou and Ingrid Melander
ATHENS, Feb 6 (Reuters) - Greece is confident it has made enough progress on its fiscal consolidation plan to get the green light this week for a fourth tranche of EU/IMF aid, a government official said ahead of an inspection visit.
International Monetary Fund and European Union officials start talks on Monday to evaluate whether the country has met fourth-quarter targets under the bailout plan that saved it from bankruptcy in May and qualifies for the next, 15 billion euro ($20.4 billion) aid instalment.
"The (aid) tranche is secured," said the finance ministry official, who declined to be named.
Greece has cut public sector wages, frozen pensions, raised taxes and started reforms to open up its economy to more competition, as agreed with the European Union and the International Monetary Fund last year in return for the 110 billion euro bailout.
Its central government budget deficit shrank more than targeted last year, the finance ministry said, mainly due to expenditure cuts, meeting an important target.
But its lenders said during their last visit in November that Greece was bound to have missed its general government deficit target, which also includes local authority spending and is a key benchmark for the EU's assessment of the programme -- partly because of a revision of 2009 fiscal data.
UNDER PRESSURE
Preliminary talks last week showed the 2010 general government deficit will be broadly in line with the 9.6 percent of GDP estimated by the EU and IMF in November, versus an initial target of about 8 percent, a source close to the proceedings said.
Greece is set to come under pressure this week from the European Commission, ECB and IMF officials -- dubbed the troika -- to do more to implement reforms as part of efforts to make further savings in 2012-2014 and catch up on 2010 shortfalls, another government official said.
"We are expecting the troika officials to ask us to speed up privatisations and the major reforms", the official said.
Greek media reports suggested on Sunday that the debt-stricken nation might be asked to put more effort into cutting labour costs, including in the private sector, to boost its competitiveness.
EU and IMF officials were satisfied with preparatory talks last week over pension reform, with the first findings of an actuarial study showing last year's shake-up of the system was on track to achieve its targets, officials said.
More talks will be needed, however, on the myriad of supplementary funds, they said.
The visit takes place as the EU examines options to help Greece tackle its debt mountain, including an extension of bailout repayments or a possible debt buy-back plan, as part of an overall deal the bloc seeks to agree in March to draw a line under the crisis and stop its contagion.
The chairman of euro zone finance ministers Jean-Claude Juncker will be in Athens Tuesday for talks with the government.
***
Tutto procede regolarmente.
