Eurogroup to release 1 bln for Greece as troika prepares for return to Athens
Monday’s Eurogroup is expected to give the formal go-ahead for 1 billion euros in bailout funding to be released for Greece as the troika prepares to return to Athens.
The Euro Working Group signed off last week on the next sub-tranche after deeming that Greece had completed the six prior actions needed. As a result eurozone finance ministers are expected to instruct the European Stability Mechanism to transfer the 1 billion euros to Athens.
Finance Minister Gikas Hardouvelis will also brief his counterparts on Greece’s progress in completing six more prior actions needed to unlock another 1-billion-euro sub-tranche.
Attention will then shift to the return of troika chiefs to Athens. Poul Thomsen of the International Monetary Fund, Klaus Masuch of the European Central Bank and Declan Costello of the European Commission are due in Athens on Wednesday. Their visit is expected to last around 10 days.
Apart from checking on the government’s progress with the remaining prior actions, the troika representatives will also look at Greece’s budget execution and the fiscal implications of court decisions to restore wages in the armed forces and emergency services to pre-crisis levels.
Hardouvelis will also have to decide whether to proceed with plans for a new bond issue. Greece is considering tapping the markets again with a 3-year note worth 2.5 to 3 billion euros but wants to do it by Thursday, before any negative developments from the troika’s visit have a chance of affecting yields.