Greece repays €750m early

Greece repaid €750m to the IMF a day early, just as eurozone finance ministers sounded upbeat on negotiations to complete changes to the country’s bailout programme.

A suggestion from the Greek Prime Minister, Alexis Tsipras, that he may hold a referendum on the revised austerity package and membership of the euro even got resigned assent from German’s Wolfgang Schäuble.

Greece needs to complete a detailed technical agreement with the EU, ECB, and IMF in the next few weeks to tap the remaining €7.2bn of its bailout.

Eurogroup president Jeroen Dijsselbloem said the money could be paid out in parts as implementation takes place. Greece is facing a series of large repayments to the ECB and IMF over the summer.

Liquidity could become a strain both in terms of the country meeting its international debt obligations and its internal ones on wages and pensions, the Dutch finance minister said. The Greek finance minister, Yanis Varoufakis, assured them these would be met.

Following a heated debate in Riga last month when Mr Varoufakis was put in the dock by his fellow eurozone ministers and a Plan B — an exit from the euro — was mentioned for the first time, Mr Tsipris took direct responsibility for the talks yesterday.

Mr Dijsselbloem said negotiations were now more concentrated, with changes in the Greek administrators reporting directly to Mr Tsipras. “That has been very helpful,” he said.

Pierre Moscovici, the European commissioner for economic and financial affairs, said there had been a new frame of mind which was proving more constructive. He pointed to a degree of convergence on Vat reform and non-performing loans, and the establishment of an independent agency for tax collection. “This should not be underestimated, there is specific progress and it is welcome,” he said.

However, there were still significant differences on pensions and labour market reforms.

Mr Dijsselbloem said while it was up to the Greek government to decide on holding a referendum, time would be an issue.

Mr Tsipras, who is under pressure from the extreme left in his party to resist further austerity, has hinted at holding a referendum, which he could expect to win as a majority in Greece want to retain the euro.

Article Source: