Euro Working Group Not Unblocking Greek Debt Relief Measures Yet



The Euro Working Group has not decided on Tuesday to unblock debt relief measures for Greece after Athens decided to give a Christmas bonus to pensioners and reduce VAT on certain Aegean islands.

The short-term debt relief measures were decided at the December 5 Eurogroup. However, the sudden unilateral move of Alexis Tsipras to give pensioners a bonus and reduce VAT on certain islands without the creditors‘ consent was considered by certain euro zone finance ministers as a breach of trust.

Euro zone officials discussed the issue but no unanimous agreement was reached. Talks will continue on Wednesday, with the Greek government hoping that creditors will lift the block. The Greek position is that the funds allocated are from the primary surplus achieved and do not affect the bailout program.

German Finance Minister Wolfgang Schaeuble, however, stated that the Greek government announcements were not in accordance with the obligations the Greek prime minister has agreed on.