Despite Eurogroup ‘breakthrough,’ way forward remains unclarified

Despite Eurogroup ‘breakthrough,’ way forward remains unclarified

Despite the “breakthrough” at last Friday’s Eurogroup in Malta, the deal struck between the government and its European Union partners remains unclear on several issues, not least the time frame of its implementation.

According to a government official on Monday, a time frame is not expected to be formulated until after Easter.

What is clear is that another round of talks will be required to lay out the steps needed to formally conclude the second review of the country’s third bailout. Moreover, a lot will depend on the spring meetings of the International Monetary Fund and the World Bank Group on April 20-23 as the Washington-based organization has yet to decide if will take part in the Greek program.

Most importantly, the announcement of specific measures for debt relief and the formula that will pave the way for Greece to join the European Central Bank’s quantitative easing program (QE) are considered pivotal to the way forward. Both Prime Minister Alexis Tsipras and Finance Minister Euclid Tsakalotos have made clear that if debt relief measures are not agreed to, Athens will not implement the measures it has agreed to with regard to pension cuts and reducing the taxable income threshold.

The government, which is banking on the scenario that the review will be concluded by the end of the month, says it does not know when the batch of measures for 2019 and beyond will go to Parliament.

Officials said, however, that the measures could be voted through Parliament before anything has been agreed on debt relief. But if no decision on debt is made within a time frame acceptable to Athens then the legislation will be canceled. “It’s not something difficult. [Measures] can be canceled with a law, or a line of text,” a government official said.

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