BUSINESS

Debt talks shift to Bari on Friday

TAGS: Finance

On the fringes of the G7 council of finance ministers in Bari, Italy, Greece’s creditors will on Friday try to find a compromise solution on the Greek debt that will allow for the return of the International Monetary Fund to the Greek program, a day after the European Commission downwardly revised its forecast for Greek growth this and next year.

In its spring forecasts for the eurozone, Brussels brought down its 2017 growth estimate for Greece from 2.7 to 2.1 percent and that for 2018 from 3.1 to 2.5 percent. It attributed its revision to the delays in the review and the worse-than-expected last quarter of 2016.

Athens responded on Thursday saying that the primary surplus can be attained even if there is zero growth, but the revised estimates will certainly form part of talks of the so-called Washington Group in Bari, with ministers of leading eurozone states and the heads of the country’s creditors.

The momentum of the last few days points toward a compromise, but the political decisions required are still pending. The European Stability Mechanism has already examined various scenarios and has identified its differences with the IMF.

The Wall Street Journal reported on Thursday that the Greek government is planning a bond issue between July and September, following a deal for a debt settlement and Greece’s inclusion in the European Central Bank’s bond-buying program, which might happen from July, according to the same report.

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