Review may not end on Monday

Review may not end on Monday

Three key prior actions from the third bailout review remain unfulfilled, leaving the approval of the tranche by Monday’s Eurogroup quite uncertain.

“Very soon,” is the response a eurozone official provided to the question of when the green light for the disbursement of the first subtranche of 5.7 billion euros would be given, avoiding setting a specific date.

This is a development the Finance Ministry may have expected but will be deemed far from pleasant, if confirmed on Monday. Nevertheless, the eurozone finance ministers are not expected to lay any blame on the Greek government, as they will argue that the delay is to a great extent due to technical reasons beyond the government’s competence.

The outstanding milestones are quite important for the creditors, as they regard binding offers for the privatization of gas network operator DESFA, the Council of State decision on the development of the old airport at Elliniko, southern Athens, as well as the thorny issue of the expansion of online foreclosures: The creditors will have to decide whether the auctions continue unhindered; they will ratify if this milestone is reached, the same eurozone official noted, acknowledging that the transition by the government from physical to online foreclosures is not easy.

He further explained that the issue of the monitoring process after the bailout program expires in August is associated with the ongoing discussion on the easing of Greece’s debt, but stopped short of saying whether a precautionary credit line would be necessary. What he did say is that talks on the debt are at this stage focusing on forming the mechanism that will link the degree of debt easing to the rate of the Greek economy’s growth: “This is a very important aspect of the discussion,” he commented.

Monday’s Eurogroup will also examine the prospects of the fourth and final review by setting its priorities and the dates for the arrival of the creditors’ representatives in Greece, so that the process can begin.

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