The European Stability Mechanism is tying up Greece’s cash buffer with safety clauses, to ensure that those funds are only used for the purpose they are intended for – and not handouts.
This stems from the ESM proposal on the terms of the final 15-billion-euro tranche to Greece as tabled in the German parliament along with the rest of the Eurogroup agreement’s texts.
The ESM proposal also provides for the bailout tranche of 15 billion to be disbursed in subtranches, and foresees 5.5 billion euros of that possibly being used to service the debt and going into a special account, while the remaining 9.5 billion euros is added to the cash buffer and goes into another special account.
It further dictates that there will safety clauses for the monitoring of the account and the use of its resources; they will provide for conditions of information and sufficient surveillance, and offer enough flexibility for the use of the cash buffer while guaranteeing that the funding needs are covered using Greek resources too. Any such moves will require the consent of the ESM, which at any point will be able to redirect the resources remaining in the cash buffer following an assessment of whether they are indeed needed as a buffer or for any alternative use.