Budget progress to impact on debt measures

Budget progress to impact on debt measures

Some of the measures for easing Greece’s debt will only be implemented if the country adheres to the commitments it has made on the primary budget surpluses, European Commission Vice President Valdis Dombrovskis said.

Dombrovskis told a press conference on Friday in Athens – which he held with Finance Minister Euclid Tsakalotos – that it is important for Greece to remain focused on meeting the primary surplus targets after it emerges from the bailout program, as “returning to the markets is a delicate exercise.”

Those targets are for 3.5 percent of gross domestic product until 2022 and around 2 percent after that, although the latter will be determined more precisely with the updating of the debt sustainability analysis that is to be presented on Thursday at the Eurogroup meeting of eurozone finance ministers.

The Latvian official added that the return of economic growth in Greece may also create a fiscal margin. How this is used will be up to the finance minister, but he will need to discuss it with the creditors first. Dombrovskis also said that Greece will again be monitored by the biannual budgetary surveillance mechanism.

Tsakalotos added that this mechanism will kick off in October with the submission of the 2019 budget.

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