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10 February 2014

Greek government denies it requires third bailout


PM Samaras and Finance Minister Stournaras stressed that Greece does not need any more bailout loans, thereby responding to German Finance Minister Schäuble's statement that the most likely scenario would be for Greece to take a new loan of €10-20 billion to plug the holes in its programme.

According to ENET, the government rejected claims from a leading EU statistics official that there is no clear evidence yet that the economy produced a surplus in 2013. "We are achieving our targets in the current aid programme – and it works," PM Samaras told German tabloid Bild in an interview"No one in Europe is talking about a Grexit anymore; that's over for good! Now they're talking about a 'Grecovery'; they anticipate development in Greece after six painful years of recession ahead. It's getting better every day; the first time we will achieve a significant primary surplus, which is impressive." Officially, the finance ministry says that the 2013 primary surplus will be around €813. However, Samaras told MPs a fortnight ago that the figure could exceed €1 billion.

Samaras continued: "No, we will not need a third bail-out load. I have, moreover, no information that Wolfgang Schäuble is really preparing for such a programme. His comments were very positive in the past week, a recognition of the progress that has been made. Of course there are financial instruments in this programme that were not used in the end, and we are talking to our partners about how to replace them. But this is something completely different. There is also the agreement with the EU that, in the case of achieving our goals such as the primary surplus, we could expect an easing of our burden, for example in the form of longer maturities and lower interest rates. But all these options are already provided for under the current programme."

Meanwhile, Kathimerini reports that the Greek government plans to try to return to borrowing from the markets before May’s European elections and will seek a further credit line from the ESM, the eurozone bailout fund. Greece is expected to have a funding gap of up to €14 billion for 2014 and 2015, mostly due to the funds used to conduct the bond buyback at the end of 2012. The government is also considering refinancing the bonds used for the bailout of Greek banks which mature this year, extending the maturities on the bonds bought by the ECB or using unspent cash in the bank bailout fund.

 

Bank of Greece governor Provopoulos: The Greek financial crisis - from Grexit to Grecovery, 7.2.14 © BIS





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