Debt solutions prepared for growing woes
Greece’s international lenders may provide the country with additional money or more time to repay its 110-billion-euro loan but the government will have to dig deep to sell off more of its silverware along with further budget cuts in the coming years. Representatives from the International Monetary Fund, the European Central Bank and the European Commission concluded a review of Greece’s progress yesterday, giving the green light for a third loan payment of 9 billion euros. Poul Thomsen, head of the IMF’s Greece mission, said that if Athens needs more funds due to its inability to borrow money on debt markets, then the lenders will examine the possibility of extending the EU-IMF loan repayment period or providing another loan. Greece’s debt repayment schedule for the next three years foresees the payment of some 84 billion euros in interest and principle. In addition to this amount, treasury bills need to be refinanced and the country has to repay tranches of the IMF-EU loans in four to five years. Finance Minister Giorgos Papaconstantinou admitted yesterday that «it is obvious that payments after 2013 will be difficult,» reiterating that he expects Greece to return to the debt market next year. With Greece seen missing a full-year 2010 budget deficit target by about 1.5 percentage points, Athens has pledged more cuts to stay on target in the coming years. The government has agreed to identify additional fiscal measures for 2012-14, worth 5 percent of gross domestic product, to be able to cut its budget deficit to below 3 percent of GDP by 2014, according to Thomsen. On the privatization front, Papaconstantinou said Greece plans to raise 7 billion euros in revenues by 2013, with the first billion to be raised in 2011. No further details were disclosed. «We will complete the recording of real estate assets by the middle of 2011,» he told reporters. The government’s real estate portfolio is estimated by property experts to be worth more than 300 billion euros. A large number of ministries involved in the decision-making process and a lack of clear ownership rights on property claimed by the government are seen as being among the obstacles to developing the assets. [email protected]
