BUSINESS

Deal between Athens and lenders within sight

TAGS: Economy, EU

Government officials will go into talks with the institutions on Saturday hoping they will culminate in a staff-level agreement (SLA). Some common ground was achieved on Friday but the Greek side had to make several concessions.

Following clashes this week at an Athens courthouse where property auctions were taking place, the creditors asked for greater security to be provided to notaries participating in the process. It was agreed that the law would be tweaked so anyone involved in violent protest could be arrested on the spot rather than following an official complaint from a notary.

The government also agreed to make changes by February to the so-called Katseli Law, which protects primary residences from foreclosure, depending on the owner’s financial situation. The aim is to prevent strategic defaulters from being able to take advantage of the safeguards.

There was also an agreement on the creation of a credit bureau, which will provide Greeks with credit scores based on what they owe to the state as well as to banks. These scores will not just be used for banks to make lending decisions but could also be employed in business transactions or property rentals.

The Greek side appears to have failed in its attempt to convince the creditors to suspend plans to scrap the value-added tax discount enjoyed by some Aegean islands from the beginning of next year. This means that the 80 million euros the coalition wanted to use to fund the lower VAT rate for the islands in question will probably not be spent on measures aimed at helping these islands in other ways.

The 80 million is due to come from the total savings of 320 million euros the government has identified as part of a spending review. There was an agreement on Friday for 160 million euros from this amount to be used to increase the budget for family welfare payments. However, changes to the way child benefit payments are structured will have to be made.

A European Union official speaking on condition of anonymity in Brussels said that there is a good chance of a technical agreement being reached ahead of Monday’s Eurogroup. He underlined, though, that Athens would still have to complete dozens of prior actions in the coming weeks, some of which have to be done before Christmas.

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