ECONOMY

Brussels awaits, Athens plays down rift with troika

The return to Athens of representatives of Greece’s international creditors – the European Commission, European Central Bank and the International Monetary Fund, known as the troika – remained up in the air until 9 p.m. on Friday evening, as the troika had not yet received the guarantees required for the visit to go ahead, Brussels sources told Kathimerini correspondent Nikos Chrysoloras.

They added, however, that if the guarantees requested from the Finance Ministry did arrive by midnight Friday (Central European Time), the troika would fly to Greece early next week as planned.

In Athens, government officials spoke of “an exaggeration” regarding the actual differences between Athens and its creditors. Greece and the troika will try to bridge the gap on a variety of issues ranging from the labor mobility scheme and the defense industry to more general topics such as the social security system and the size of the fiscal gap. They will also have to eliminate the sense of political mistrust cultivated in recent days.

The premier’s office expects tough negotiations, though Prime Minister Antonis Samaras himself has said “it will be no war.” Athens is making it clear it wants the negotiations that are supposed to restart on Tuesday to be unblocked and it certainly wants to avoid being blamed for the stalling of talks.

Nevertheless, sources close to Samaras say that “if the troika returns to ask for measures of 2.5-2.9 billion euros, it is obvious the chances of an agreement are considerably reduced.” If that happens, it is possible that decisions will be postponed until April, via a supplementary budget.

Athens says the fiscal gap for the 2014 budget could be revised up to 700 million euros but in no way would it reach the 2.5 billion that the troika has suggested. It also insists the social security bill, which is yet to be tabled in Parliament, is sufficient to cover almost the entire gap, a suggestion which the troika has rejected.

Meanwhile, according to a senior Finance Ministry official, the troika has also rejected the latest government restructuring plan to save Hellenic Defense Systems (EAS). Instead, the creditor representatives are reportedly asking for the company to be absorbed by the army along the same lines as the plan drafted for the Hellenic Vehicles Industry (ELVO).

This is set to lead to a smaller EAS than what the Greek side has proposed, something which the government is not prepared to accept.