European Economic and Monetary Affairs Commissioner Pierre Moscovici and other European officials on Tuesday expressed optimism about the outlook for the timely completion of Greece’s bailout review and the prospects for debt relief but all sides are pressing their agendas ahead of a Eurogroup meeting on Monday.
An agreement is possible by the end of the year, Moscovici told reporters at the end of a two-day visit to Athens.
It is “doable, feasible,” he said, adding that “the precondition is to have pre-agreement this weekend involving all partners.”
Eurogroup chairman Jeroen Dijsselbloem confirmed that debt measures would be discussed on Monday in the hope of persuading the International Monetary Fund to sign on to the bailout.
“I think the IMF is committed because they had already agreed in May to go to the board before the end of the year,” Dijsselbloem told MEPs in Brussels.
In what appeared to be a gesture toward the IMF, Dijsselbloem admitted that EU officials might be demanding too much austerity from Greece.
“The IMF has a point that running a primary surplus of 3.5 percent of GDP for a very long time is a huge thing to ask and we need to be realistic here,” he said, referring to the EU’s 2018 target for Greece.
According to sources, Greek officials are concerned that a potential compromise between creditors could result in more than 3 billion euros’ worth of new austerity for Greece.
The Fund has set three conditions for it to join Greece’s third bailout program: One is the implementation of all reforms by Greece, the second is that primary surplus targets be reduced and the third is for debt relief measures to be agreed.
Meanwhile certain European countries, notably Germany, are reluctant to offer concessions on debt.
In comments on Tuesday, Finance Minister Euclid Tsakalotos described the December 5 Eurogroup as a “milestone” but noted that an extraordinary Eurogroup would likely be held before year-end.
Tsakalotos on Monday echoed Prime Minister Alexis Tsipras in suggesting that non-completion of the bailout review could trigger political instability.
But government spokesman Dimitris Tzanakopoulos sought to douse speculation about early elections, saying there are no such plans and that snap polls during negotiations with creditors would be “dangerous for the economy and the country.”