BUSINESS

Government optimism for a positive review from Brussels

EIRINI CHRYSOLORA

Last Thursday Finance Minister Christos Staikouras said in Brussels that planning for the Hercules project for the reduction of nonperforming loans is expected to be completed by the end of this week.

TAGS: Finance

Up until just a few days ago, the main field of pending actions for the successful closure of the fourth post-bailout assessment by the country’s creditors, in the context of Greece’s enhanced surveillance, was the energy sector, according to sources from Brussels.

The latest information now shows that the open issues in this sector appear to be closing, which generates optimism among Finance Ministry officials that a favorable report will be issued by the European Commission on November 20.

Government sources note that Greece’s creditors are also keenly awaiting the bill that will set in motion the Hercules plan for the reduction of Greek banks’ nonperforming loans. While it is explained that Hercules is not a prior action required for the fourth assessment, there is a definite interest in it due to the extent of the problem. Finance Minister Christos Staikouras said in Brussels last Thursday that the planning for the Hercules project is expected to be completed by the end of this week. He also expressed optimism about the outcome of the fourth assessment.

The other pending issues of this review include the clearance of the state’s overdue arrears to third parties (i.e. suppliers and taxpayers). The government has forwarded its plan to the Commission, which according to sources provides for the full repayment of dues by mid-2021. All debts will have been cleared by the end of next year, excluding pensions, which will be cleared by halfway through the following year. The provisions against creating new overdue arrears in the future represent an important dimension of the plan.

Another pending matter is the formation of a new bankruptcy framework for individuals, as well as the improvement of the efficiency of the out-of-court settlement mechanism. The government has already forwarded its plans on these fronts to the creditors.

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