ECONOMY

Bailout review restarts on Wednesday

bailout-review-restarts-on-wednesday

The first meeting in the second round of the bailout review will take place on Wednesday, as the heads of the creditors’ representatives have an appointment with Finance Minister Euclid Tsakalotos and Economy Minister Giorgos Stathakis.

The talks have many points to cover and it is as yet uncertain when they will conclude, though it is certain all sides want to hit the ground running.

The Greek side is expected to complete almost all of the reforms required to receive a part of if not the entire bailout installment overdue before the start of negotiations on the state debt.

A number of eurozone states have stressed that they will only continue to support Greece if a new deal is struck between Athens and the International Monetary Fund, which requires a debt settlement.

The likeliest scenario at this stage is for the talks to proceed on all issues (including the debt) and close before the disbursement of a tranche to Greece, although this may change at any moment, according to well-informed sources.

Wednesday’s meeting will review the situation to date and plan for the meetings of the next few days.

On Thursday the creditors’ representatives will meet with Labor Minister Giorgos Katrougalos. State pensions will be on the table from the start of the talks.

There is great distance separating Athens and its creditors on the handling of bad loans, while talks will further focus on reforms in the energy sector, such as the opening up of the electricity market.

On taxation there are five main issues outstanding in the talks with the creditors, most of which will determine the level of taxes Greeks will pay in the next few years. These are income tax rates, rental income taxation, taxes on farmers, the voluntary revealing of undeclared incomes, and the further independence of the General Secretariat of Public Revenues.

Sources say that the creditors have expressed disagreement with the government on all five issues.