Eurogroup sees debt relief talks in fall

Finance Minister Yannis Stournaras conveyed Greece’s request for a lightening of the country’s debt burden to his eurozone counterparts at a summit in Brussels on Monday but, as expected, foreign officials indicated that a decision on this issue would not be considered until the fall.

Eurogroup Chairman Jeroen Dijsselbloem congratulated Greece on achieving a primary surplus, which eurozone officials agreed in November 2012 is a prerequisite for the launch of talks on debt relief. At a press conference after the summit, Dijsselbloem, who is also the Dutch finance minister, said the “relative merits of possible debt sustainability” would be considered in Greece’s next bailout review, which is slated for the fall. He added that Greek authorities should not lose “momentum” in their reform efforts.

Earlier in the day, German Finance Minister Wolfgang Schaeuble also praised Greece for its economic reform progress but noted that any decisions on debt would be taken “in the second half of the year.”

An official statement issued after the Eurogroup summit highlighted the “remarkable adjustment efforts undertaken by the Greek citizens and authorities,” which, it said, “allows the Greek economy to enter a new phase, moving from stabilization and recovery to sustainable growth.”

The European Commission, in a forecast published on Monday, also offered encouraging signs, predicting Greece returning to growth sooner than anticipated, with a projected growth rate of 0.6 percent this year and 2.9 percent in 2015. The EC saw unemployment easing from above 27 percent last year to 26 percent this year and 24 percent in 2015.

These positive economic indicators are expected to be highlighted by Prime Minister Antonis Samaras and his team in an intensifying campaign ahead of local authority and European Parliament elections, on May 18 and 25 respectively.

Other concerns – including the challenge faced by leftist SYRIZA, which is ahead in several opinion polls despite its unequivocal stance on the euro – are expected to be discussed in a meeting between Samaras and his coalition partner, PASOK leader Evangelos Venizelos, at 3.30 p.m. on Tuesday. According to sources, however, Samaras’s key concern is Venizelos’s insistence that the coalition’s cohesion is dependant on Elia – PASOK’s grouping with other center-left parties – achieving a good showing at the elections.