Greece’s international lenders won’t discuss new aid for the country before October when they present a review of the country’s bailout program to finance ministers from the region’s single currency bloc, a European Union official said Wednesday as the Greek coalition government continued to debate unpopular cutbacks.
The review will determine whether the country is eligible for a fresh aid tranche of 31 billion euros, including EUR25 billion to recapitalize its cash-strapped banks.
The latest delay of the aid disbursement, which was originally due in June but was held up as Greece went through successive elections, comes as Greek Prime Minister Antonis Samaras Wednesday moved to diffuse a brewing political row with a junior coalition partner over possible public sector job cuts.
But the truce may be short lived in the face of rising public resistance to the EUR11.5 billion in savings by 2014 needed to meet demands from international creditors in return for a EUR173 billion bailout.
The EU official said experts from the troika of Greece’s official-sector creditors –the European Commission, the European Central Bank and the International Monetary Fund– would go the Athens in early September and “stay the whole month in order to report to the October Eurogroup,” referring to the ministers’ meeting scheduled to take place in Luxembourg on Oct. 8.
An earlier mission left Athens last Sunday. It was previously expected that they would present their review to the informal euro-zone finance ministers’ meetings in Nicosia in mid-September.
“The member states need to have a clear picture of what’s going on and where we are before deciding to start paying again,” the EU official said. He added that the political turbulence caused by elections in May and June had created ” considerable delays in the implementation” of the program.
The official said that a delegation of the creditors working with the Greek authorities until last week had been “able to identify concrete measures” for EUR7 billion in cuts, out of EUR11.5 billion needed until 2014.
“In September, we’ll need to work on the remaining EUR4.5 billion so that they’re also concrete and implementable, not just fuzzy words,” the official said.
(source: Dow Jones)
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