Date
25 January 2017
A woman carries a bag of groceries at the Plaka area in central Athens. Creditors want Greece to legislate more belt-tightening measures. Photo: Reuters
A woman carries a bag of groceries at the Plaka area in central Athens. Creditors want Greece to legislate more belt-tightening measures. Photo: Reuters

Greece starts bailout talks with dispute on up-front actions

Greece has started talks with its creditors for the release of emergency loans next month, with officials arguing over which up-front commitments the government has yet to implement.

Technical experts from the European Central Bank, the International Monetary Fund, the European Stability Mechanism and the European Commission are in Athens to negotiate with their Greek counterparts, Bloomberg News reported.

Discussions are focusing on the list of policies that must be legislated over the next three years in exchange for a lifeline of as much as 86 billion euros (US$95 billion), the news agency said.

A so-called Memorandum of Understanding would need to be agreed upon in the next two weeks, so that a bailout can be in place before a payment on bonds held by the ECB comes due on Aug. 20.

Failure to do that might force another bridge loan to avert default, which may also come with strings attached, the report said.

Greece’s commitments include changes to the country’s pension system, labor market, fiscal policy and market regulation, the Finance Ministry said.

“An agreement by the second fortnight of August is possible,” EU Commission spokeswoman Mina Andreeva told reporters in Brussels on Tuesday. “Talks only started yesterday so it’s premature to specify any actions or deadline.”

Creditors want Greek Prime Minister Alexis Tsipras to restore trust by legislating more belt-tightening measures now, before a disbursement from the European Stability Mechanism program can be made.

In two votes earlier this month on so-called prior actions required for negotiations to begin, about a quarter of his Syriza-party lawmakers defected, stripping the premier of his parliamentary majority and forcing him to rely on opposition support.

A Finance Ministry official said Greece has already voted through parliament all the measures it needed to implement before a deal can be reached.

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