Impasse stalls review as official sees no deal at Eurogroup

Impasse stalls review as official sees no deal at Eurogroup

The prospects for a conclusion to a seemingly never-ending bailout review were as dim as ever on Friday as Eurogroup leader Jeroen Dijsselbloem stated outright that the review will not be completed at the next scheduled meeting of eurozone finance ministers on April 7.

From early on Friday, government officials sought to point to momentum in ongoing negotiations and indicated that a date for the return of bailout monitors to Athens would be announced during the course of the day.

In the end, not only was no date announced but officials expressed concern about an impasse in talks, particularly on calls by lenders for further cuts to pensions.

Speaking to reporters in The Hague, Dijsselbloem said progress had been made but that “key” issues remain. He added that he hoped the review could be completed “soon” but that this would not happen in Malta on April 7.

The latest upset in negotiations arose after representatives of Greece’s creditors, and the International Monetary Fund in particular, called for further cuts to pensions that Athens has agreed to be carried out in 2019, not 2020.

The distinction is an important one for creditors as general elections are scheduled to take place in Greece in 2019 and it is likely that a new government will be elected and may refuse to honor commitments made by the current administration.

Both IMF officials and German Finance Minister Wolfgang Schaeuble have indicated that they would like the Greek political opposition to back measures currently being hashed out between the government and creditors. New Democracy leader Kyriakos Mitsotakis has rejected such a move and has said neither he nor his party has been approached by creditors to offer such support.

The protracted impasse in the bailout negotiations has fueled economic uncertainty, with sources indicating that some 1.5 billion euros in savings were withdrawn from Greek banks in March alone, bringing total withdrawals since the beginning of the year to 4 billion euros.

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