Greek govt resumes talks with troika auditors over next bailout aid tranche

Source:Xinhua Published: 2013-7-2 8:35:22

Envoys of Greece's international creditors returned to Athens on Monday to resume talks with Greek government officials over the new series of steps which will pave the way for the disbursement of the next bailout aid tranche to the debt-ridden country this summer.

The key topics on the agenda of troika auditors with Finance Minister Yannis Stournaras and newly appointed Administrative Reform Minister Kyriakos Mitsotakis on Monday afternoon, according to sources, were missed goals and timetables in the implementation of the austerity and reform program launched three years ago which will expire in 2014.

The top thorny issue on the table is the mobility scheme agreed with inspectors in previous reviews of Greece's fiscal adjustment program. The mobility plan foresees the transfer of 12,500 civil servants to other posts in the public sector otherwise their suspension on lower pay for a year before their final dismissal.

The initial deadline was set for this July, but Mitsotakis asked for an extension to autumn, according to local media reports.

In the aftermath of the closure of Greece's national broadcaster in June which led to a government crisis, the withdrawal of a small party from the ruling coalition and a cabinet reshuffle, Athens appears skeptical on more "sudden deaths" of state companies.

Greek officials express the determination to move forward with measures to overhaul civil services to save costs and boost efficiency, but want to avoid further upheaval.

Another contentious issue on the agenda is a fiscal shortfall of at least one billion euros (1.3 billion US dollars) this year, mainly attributed to missed targets in the budget of Greece's largest healthcare organization, EOPYY.

The representatives of European Commission, European Central Bank and International Monetary Fund, who have been keeping Greece afloat with vital bailout rescue loans in return for painful policies since 2010, also discussed with Greek officials delays in Greece's privatization program and taxation issues.

Greek officials expressed optimism that negotiations with troika inspectors will end positively hopefully before the next Eurogroup meeting on July 8 or around mid-July, so that Athens receives the next 8.1 billion euros installment in time for the repayment of 2.2 billion euro worth bonds maturing in August.

Amidst deep recession and left with a slim majority in parliament, the two-partite coalition government dismisses scenarios of new austerity measures to plug gaps and secure further funding.

However, analysts note that Greece needs to persuade lenders that it will meet targets and be able to address the looming fiscal gap without imposing extra cuts on salaries, pensions and tax hikes.

Otherwise, IMF in particular under its charter could stop the flow of loans to Athens, adding pressure on European Union to consider an imminent new write down of Greece's debt load, an idea which is not welcome by European counterparts at the moment.



Posted in: Europe

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