EWG gives nod on review completion


The Euro Working Group gave the green light on Friday for the completion of the third bailout review in principle, but property auctions are still causing concern as they are seen as crucial to determining the course of Greek banks and whether or not a new recapitalization will be required.

Aware of the continued unrest in Greece over foreclosures, the creditors decided to raise the pressure on the government by tying one of the upcoming subtranches to unhindered property auctions.

The senior officials of the eurozone’s finance ministries agreed on Friday in a conference call that 89 out of the 113 prior actions have been implemented, and that the rest will have to be covered before the disbursement of the first subtranche, which is expected by mid-February.

The EWG also decided that the second subtranche will depend on the satisfactory execution of online auctions, as well as adequate progress in the state’s payment of overdue debts to taxpayers and suppliers.

Also on Friday Christine Lagarde, the managing director of the International Monetary Fund, warned Athens that reforms are a process without a finish line and stressed that there remains a lot to be done.

Sources from Athens say that among the review’s milestones that Greece has not yet reached are the approval of the presidential decree for the development at Elliniko as well as certain regulations concerning the application of the clawback mechanism in healthcare and other technical amendments in energy, mining and social security.

A senior Finance Ministry source said the outcome of yesterday’s EWG was “favorable,” adding that it has opened the way for the completion of the third review at Monday’s Eurogroup.

The installment to follow the completion of the third review is expected to reach up to 6.7 billion euros. This is 1.9 billion euros more than the country’s loan needs and the scheduled payments of expired debts, according to the same ministry source. This 1.9 billion will be used as a cash buffer ahead of Greece’s full return to the money markets later this year.