December 14, 2017

Missteps in Big Asset Sales Plague Greece as Privatization Chief Resigns

One of the ways Greece plans to dig itself out of debt is through the sale of state-owned assets. But that effort has been besieged by missteps.

The latest involved Stelios Stavridis, the chairman of the government privatization agency, who had overseen one of the country’s first big asset sales — a one-third stake in the state gambling company, OPAP, for 652 million euros. But then he hitched a ride to a vacation spot on the private jet of a Greek oil magnate involved in the deal.

Government officials insisted that Mr. Stavridis’s ouster from the privatization agency, Taiped, was “for ethical reasons” and would not upset the country’s state sell-off effort. But the privatization program has suffered from political upheaval and delays and has fallen far short of the revenue targets set by Greece’s so-called troika of foreign creditors, the European Commission, the European Central Bank and the International Monetary Fund.

The Greek finance minister, Yannis Stournaras, on Sunday sought Mr. Stavridis’s resignation from Taiped after a newspaper quoted the chairman as saying he had traveled last week on the Lear jet of the oil and shipping oligarch Dimitris Melissanidis, a major stakeholder in the Greek-Czech consortium Emma Delta, which agreed to buy the OPAP stake in May.

The contract was signed Aug. 12 after much wrangling over the details. A few hours later, Mr. Stavridis, a 65-year-old Swiss-trained engineer, joined the oil magnate on his plane, which dropped Mr. Stavridis on Cephalonia, an island in the Ionian Sea where he spends his summer vacations. “Melissanidis, who was traveling to France, offered to take me with him to accommodate me,” Mr. Stavridis was quoted as telling the Proto Thema newspaper, which published a photograph of him, smiling, sitting next to a flight attendant.

Speaking to the Greek private television channel Skai after his firing on Monday, Mr. Stavridis defended his decision to fly on Mr. Melissanidis’s jet, noting that the trip had come long after the OPAP deal was completed. He referred to “hypocrisy” in Greek society which, he said, was interested in “the facade rather than the essence.”

“I am not a monk and I won’t hide,” said Mr. Stavridis, who founded Piscines Ideales, one of Europe’s largest manufacturers of swimming pools in 1991. More recently, he was head of the Athens water board, Eydap, which is also in the country’s privatizations portfolio.

Less than six months earlier, Mr. Stavridis’s predecessor, Takis Athanasopoulos, was accused of a breach of faith during a previous stint at the head of the state electricity board. Prosecutors accused him of commissioning a power station in central Greece even though he knew it could not operate profitably.

The main left-wing opposition party, Syriza, which has vowed to reverse all privatizations if it comes to power, said Taiped was “a tool of the troika” whose goal was “the biggest sell-off of state wealth that Europe has seen since the era of East Germany.” In a statement on Monday, Syriza described the Stavridis affair as “the first clear admission of the dirty relationship between the government of the memorandum and business interests,” referring to the Greek deals for foreign loans.

The troika has urged Athens to speed up state sell-offs and to step up tax collection to raise much-needed money. But revenue targets have been revised downward several times. The original target of 50 billion euros by 2016 was later changed to 19 billion euros, then to 15 billion euros. Since last year, the troika has focused on annual targets. But Taiped is expected to fall 1 billion euros short of its 2.5 billion euro target for 2013.

Article source: http://www.nytimes.com/2013/08/20/business/global/missteps-in-big-asset-sales-plague-greece-as-privatization-chief-resigns.html?partner=rss&emc=rss

Greece Makes Progress in Opening Restricted Professions

ATHENS — Greece has opened up 247 of its 343 “closed professions” — occupations ranging from notary to taxi driver — where access had been subject to a maze of restrictions, government officials said Thursday.

The officials said the deregulated job market offered greater opportunities to the country’s job seekers as new figures showed the unemployment rate edging even higher.

“Of the 343 professions, 72 percent have been fully liberalized,” Finance Minister Yannis Stournaras said during a joint news conference with Costis Hatzidakis, the development minister. Other fields, including law, engineering and architecture, were “being gradually opened up,” he added.

The progress in breaking open restricted-access occupations, something Greece’s foreign creditors have been demanding for the past three years, “is of extreme significance for those who don’t have work and who will now have better access to the job market,” Mr. Hatzidakis said.

His words came as the Greek national statistical service, Elstat, released figures showing that the unemployment rate reached 27 percent in February — up from 26.7 percent in January. The rate was 64.2 percent among Greeks 15 to 24, a record for Greece and the highest level in the euro zone.

A more effective crackdown on tax evasion and the liberalization of closed professions are the two key areas where Greek reforms are lagging, according to a report released earlier this week by the International Monetary Fund, which together with the European Union has extended two bailouts, worth €240 billion, or $315 billion, to Greece since 2010.

The I.M.F.’s report hailed efforts by the country to reduce its budget deficit and debt burden.

Euro zone finance ministers are to decide Monday on the release of a €4.2 billion tranche of aid for the first quarter of the year. Mr. Stournaras said Thursday that he would ask his European peers to approve the release of another installment, worth €3.3 billion, scheduled for the second quarter.

In an interview with state television earlier Thursday, Mr. Stournaras said he believed Greece would return to bond markets by the end of 2014 after bond yields on Wednesday dropped to their lowest levels since last year’s government debt restructuring.

Article source: http://www.nytimes.com/2013/05/10/business/global/greece-makes-progress-in-opening-restricted-professions.html?partner=rss&emc=rss

Euro Zone Officials Give Greece Additional $2.8 Billion in Loans

ATHENS — Euro zone officials on Monday approved the release of €2.8 billion in loans to Greece, the country’s Finance Ministry said, paving the way for the approval of an additional €6 billion installment of aid at a meeting of the currency union’s finance ministers in mid-May.

The Greek Parliament late Sunday approved a controversial plan to dismiss 15,000 civil servants by the end of next year as part of a new package of economic measures that the country must enforce in order to receive continued financing from the troika of foreign creditors: the International Monetary Fund, the European Central Bank and the European Commission.

The €2.8 billion, or $3.7 billion, approved Monday in Brussels was originally to have been disbursed in March but was delayed after negotiations between Greece and the troika stalled over the creditors’ demands for civil service cuts.

“There was a positive evaluation of the implementation of the Greek program and clear references to the decisiveness of the government in proceeding with reforms set out in the program,” the Greek Finance Ministry said.

The disbursement of the €6 billion installment of loans, in May, is dependent on the adoption of further measures by Athens, including an overhaul of the tax collection system.

The government’s latest measures passed into law in a vote held shortly before midnight on Sunday with 168 votes in the 300-seat House.

A last-minute amendment allowing the local authorities to hire young Greeks for less than the minimum wage of €586 a month fueled angry protests by the political opposition. But the inclusion of measures intended to ease some of the financial burden on homeowners, including a 15 percent reduction in a new property tax, clinched the support of lawmakers in the three-party ruling coalition.

Defending the bill, the finance minister, Yannis Stournaras, insisted that there was no choice but to implement the measures. “Greece is still cut off from the markets,” he told lawmakers, adding that the government’s chief aim was to achieve a primary surplus before seeking a further “drastic” reduction of its debt, which stood at 160 percent of gross domestic product at the end of last year.

His claims were derided by the opposition. “With blood, tears and looting, they will achieve surpluses like those achieved by Ceausescu in Romania and Pinochet in Chile,” said Alexis Tsipras, leader of the main leftist opposition party, Syriza, which wants Greece to revoke its agreement with the troika.

“Claim back your lives and your country that they are stealing,” he said as a few hundred people, mostly civil servants, staged a low-key protest outside Parliament.

The ruling coalition, led by Prime Minister Antonis Samaras, faces a difficult balancing act to reassure its foreign creditors and its long-suffering citizens, who have seen their incomes dwindle by a third and unemployment skyrocket to 27 percent in the past three years.

Article source: http://www.nytimes.com/2013/04/30/business/global/30iht-eugreece30.html?partner=rss&emc=rss

Parliament Passes Plan for Layoffs in Greece

Euro zone officials meeting in Brussels on Monday are expected to approve the release of about 2.8 billion euros, or about $3.65 billion, in loans. The money had been due in March but was delayed after negotiations between Greece and the so-called troika of its foreign lenders stalled over the lenders’ demands for civil service cuts.

The troika, which comprises the European Commission, the European Central Bank and the International Monetary Fund, has been meting out aid in exchange for belt-tightening measures. They are to decide on another six-billion-euro installment in May, assuming Greece adopts further reforms, including an overhaul of a tax collection system.

The latest measures passed into law in a vote held shortly before midnight on Sunday with 168 votes in the 300-seat House.

A last-minute amendment allowing local authorities to hire young Greeks for less than the minimum wage of 586 euros per month fueled protests during the debate. But the inclusion of measures aimed at easing the burden on Greeks, including a 15 percent reduction to a contentious property tax, clinched the support of lawmakers in the three-party ruling coalition.

Defending the bill during a heated debate, Finance Minister Yannis Stournaras insisted that Greece had no choice but to implement the economic reforms. “Greece is still cut off from the markets,” he said, noting that the government’s chief aim was to achieve a primary surplus before seeking a further “drastic haircut” to its debt, which stood at 160 percent of gross domestic product at the end of last year.

His claims were derided by political rivals who denounced the lawmakers as beholden to the nation’s lenders. “With blood, tears and looting, they will achieve surpluses like those achieved by Ceausescu in Romania and Pinochet in Chile,” said Alexis Tsipras, the leader of the main leftist opposition party Syriza. “Claim back your lives and your country that they are stealing,” he said as a few hundred Greeks, mostly civil servants, staged a rather low-key protest outside Parliament.

Mr. Tsipras, whose party wants to revoke Greece’s loan agreement, has insisted that Greeks have an alternative to constant belt-tightening, pointing to a strong reaction against austerity across Europe.

The ruling coalition, led by Prime Minister Antonis Samaras, faces a difficult balancing act to reassure its foreign creditors and its long-suffering citizens, who have seen their incomes dwindle by a third and Greek unemployment skyrocket to 27 percent in the past three years.

Eager to bolster the prospects for investment, the prime minister is also said to be planning a series of international trips, starting with a visit to China next month.

He is expected to meet with entrepreneurs and promote Greece as a destination for tourism, virtually the only robust pillar of Greece’s shaky economy.

Article source: http://www.nytimes.com/2013/04/29/world/europe/parliament-passes-plan-for-layoffs-in-greece.html?partner=rss&emc=rss

Greece Reaches New Deal With Lenders

ATHENS — After nearly two weeks of tense negotiations, Greece and its troika of foreign creditors said Monday that they had clinched an agreement on economic measures it must enforce to secure the release of further crucial rescue money, including thousands of layoffs in the civil service.

“We wrapped it up; we have a deal with the troika,” Finance Minister Yannis Stournaras told reporters.

His words came a few minutes after the troika, comprising the European Commission, the European Central Bank and the International Monetary Fund, who have extended two bailouts to Greece worth €240 billion, or $310 billion, over the past three years, issued a joint statement saying Greece was on track to curb its huge debt burden, which stood at 160 percent of gross domestic product at the end of last year.

“Fiscal performance is on track to meet the program targets, and the government is committed to fully implement all agreed fiscal measures for 2013-2014 that are not yet in place,” the statement said, adding that the release of a loan installment of €2.8 billion that had been due in March “could be agreed soon by the euro area member states.”

The International Monetary Fund’s envoy to Athens, Poul Thomsen, said the release of the €2.8 billion, as well as another €7.2 billion for the recapitalization of Greek banks, could be released as early as next week

The troika’s statement added that an agreement had been reached on streamlining the Greek civil service and emphasized the importance of recapitalizing Greek banks without delay. It said Greece would probably return to growth next year.

Mr. Stournaras was even more upbeat, saying Greece aimed to achieve a primary surplus this year, which would allow it to seek more debt relief, according to an agreement with creditors.

The issue that caused negotiations to stall in mid-March was the overhaul of the bloated civil service, a contentious topic that has tested the cohesion of Greece’s fragile coalition government. An agreement was finally secured over the weekend, with the two sides agreeing that 15,000 civil service positions would be eliminated by the end of next year, including 4,000 this year, according to reports in the Greek news media. The departures are to include employees close to retirement and an estimated 2,000 who have been accused of disciplinary offenses.

The plan has prompted vehement reactions from the government’s political rivals, with Alexis Tsipras, the head of the main leftist opposition party, Syriza, describing it Sunday as “a human sacrifice” that would merely swell the ranks of the unemployed, who already account for 27 percent of the population.

According to leaked details of the deal with the troika, foreign inspectors accepted Greek demands to reduce by 15 percent a contentious property tax, which was introduced as an emergency measure in 2011 but has been extended. The two sides are also said to have agreed on allowing Greeks owing taxes and social security debts to the state to pay them off in up to 48 monthly installments.

Mr. Thomsen of the International Monetary Fund said in a speech to a conference organized by The Economist that widespread tax evasion “remains a huge problem.” He added, however, that Greece had “indeed come a long way.”

“The fiscal adjustment has been exceptional by any standard,” he said.

Article source: http://www.nytimes.com/2013/04/16/business/global/greece-reaches-new-deal-with-lenders.html?partner=rss&emc=rss