April 15, 2021

Lenders Close to Agreement on Greek Aid

International lenders are very close to wrapping up talks with Greece to unlock a further €8.1 billion in loans, though more efforts are required from Athens to overhaul its economy, the European Union’s top economic official said Sunday, a day before euro zone finance ministers meet to decide on the aid.

Athens has been in talks with inspectors from the Union, the European Central Bank and the International Monetary Fund, otherwise known as the troika, since last Monday to discuss progress on overhauls agreed as part of its €240 billion, or $308 billion, bailout.

“We are very close to a staff-level agreement,” Olli Rehn, the E.U. commissioner for economic and monetary affairs, said, referring to the talks between international lenders and Greek officials.

“The final decision is for tomorrow,” he said. “The ball is in the Greek court, and it depends on whether Greece is able to deliver the remaining elements of the milestones that have been agreed.”

Greece needs the funds from the €8.1 billion tranche being reviewed to buy back €2.2 billion of its bonds due in August.

Bailed out twice by its foreign lenders, Greece relies on foreign aid to stay afloat. Failure to successfully conclude its bailout review, and unlock the funds, could push the country close to bankruptcy once again and possibly reignite the euro zone crisis.

But international officials seemed upbeat on Sunday.

“We made very good progress,” Poul M. Thomsen, head of the I.M.F.’s mission to Greece, told a news conference, adding that he hoped talks would be concluded early Monday before the Eurogroup meeting of finance ministers.

The Greek finance minister, Yannis Stournaras, also said he was optimistic that a deal would come together by Monday morning. Troika officials were to leave Athens on Sunday but were expected remain in contact with Greek officials to nail down the final details.

The €8.1 billion installment is one of the last big cash injections that Greece will receive as part of the €240 billion rescue package, which expires at the end of 2014.

Mr. Rehn reiterated that aid for Greece could be split into installments. Lenders have become increasingly frustrated with Greece’s slow progress on shrinking the civil service and making it more efficient and less corrupt.

Talks with the troika stumbled last week over a missed June deadline to put 12,500 state workers into a “mobility” plan under which they would be transferred or laid off within a year. But an agreement over the issue was reached on Saturday, with the troika reportedly giving Greece a few more months to push through the plan.

Article source: http://www.nytimes.com/2013/07/08/business/global/lenders-close-to-agreement-on-greek-aid.html?partner=rss&emc=rss