Three major hurdles to clear before release of 750 mln euros

Three major hurdles to clear before release of 750 mln euros

The Katseli law, the minimum wage and privatizations will be the three main stumbling blocks in the talks between the government and its creditors that start on Monday in Athens in the context of the second post-program assessment.

These issues, according to government sources, could even remain on the table all the way up until the March 11 Eurogroup, which is expected to issue a decision on the disbursement of 750 million euros from the profits eurozone central banks have made from holding Greek bonds (SMPs and ANFAs).

These matters are politically sensitive, and the government would obviously like to avoid any unpopular solutions, especially in the runup to this year’s general election.

On the law named after former economy minister Louka Katseli – whose provisions provide for the protection of debtors’ main residences and which expires at the end of February – the bone of contention remains the limit on the protected property’s value. This currently stands at 280,000 euros for households with three or more children, while the banks want to see this fall to 100,000 euros, and the creditors agree. The government believes that once it finds common ground with the banks, it will be easier for the creditors to agree.

On the minimum wage, the government is proposing a raise of between 5 and 10 percent, while Brussels has expressed concern with Economic Affairs Commissioner Pierre Moscovici warning that any hikes will need to be compatible with the financial conditions and the unemployment level.

The main issue on the privatizations front is the Egnatia Odos highway, with the creditors expressing dismay at the delays recorded and putting the blame on Infrastructure Minister Christos Spirtzis. They stress that some progress is needed now for all pending issues to be resolved.

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