Socialist PASOK leader Evangelos Venizelos told a conference in Athens on Tuesday that he hoped Greece would be able to benefit from a European Union concession — extended to Spain, Ireland and possibly Italy — allowing the use of EU rescue funding for the direct recapitalization of cash-trapped local banks.
Speaking on the second day of a conference organized by The Economist, Venizelos said he hoped the benefit could could apply to «Cyprus, Portugal and Greece.» «This would help reduce the debt,» the socialist leader and former finance minister told delegates.
The Pasok chief also presented a 10-point plan for Greece exiting the crisis which includes honoring the country’s commitment to the country’s creditors but also extending the fiscal adjustment period by three years, until the end of 2007.
Officials representing Greece’s international creditors — the European Commission, European Central Bank and International Monetary Fund, known as the troika, — have indicated that it is unlikely the deal could apply to Greece and certainly not until the country has put its financial house in order.
In Brussels on Monday, the spokesman for European Economic and Monetary Affairs Commissioner Olli Rehn, Simon O?Connor, played down the prospects for a concession to Greece, telling Kathimerini that it was too soon to say whether 50 billion euros in funding set aside for the recapitalization of Greek banks as part of the second bailout would be dissociated from the country?s state debt.