Greece will return to credit markets next year if the country’s international creditors offer debt relief measures at a crucial May 24 meeting of eurozone finance ministers, Greek Prime Minister Alexis Tsipras told a newspaper on Saturday.
The cash-strapped country, which has been cut off from global debt markets since 2014 and agreed a third multibillion-euro bailout in July last year, started talks with lenders earlier this week on how to make its debts more manageable.
Tsipras’ government aims to conclude a review of its progress on bailout-linked reforms at the May 24 meeting, a step that would unlock the next tranche of funds in time to meet repayments to the EU and the IMF as well as state suppliers.
Photo: AP
The leftist leader, re-elected in September last year on promises to mitigate the impact of austerity on crisis-weary Greeks, also hopes for progress on easing its debt burden, which is set to reach 182.8 percent of GDP this year, according to European Commission forecasts.
“If we achieve what we seek for the debt on May 24, we will return to the markets next year,” he told Realnews newspaper.
“We might exit the bailout once and for all a lot before the program expires in August 2018,” Tsipras added.
Greek Finance Minister Euclid Tsakalotos said last year a long-term commitment to debt relief from eurozone countries was key to restoring investor confidence, and that Athens could return to bond markets by the end of this year.
Greece’s 10-year bond yields fell below 8 percent for the first time in more than six months on Tuesday after eurozone finance ministers offered debt relief to the country from next year. They soared to almost 19 percent at the height of the country’s debt crisis in the middle of last year.
Treasury bills are Greece’s main source of short-term funding.
European Commission Vice President Valdis Dombrovskis told the Kathimerini that Greece and its lenders were very close to concluding the review on May 24, but no deadline has been set.
Greece last week voted pension and tax reforms, part of a package agreed under its bailout.
Dombrovskis said Athens needed to legislate the remaining measures and contingency reforms, which the country would not have to implement unless it falls short of its fiscal targets.
Tsipras’ government is expected to submit a bill on the pending reforms and secure a parliamentary approval before the Eurogroup meets to wrap up the review.
The package would probably include a set of indirect tax hikes, setting up a new privatization fund, regulations on Greek banks’ “bad loans” and the contingency reforms.
Dombrovskis said eurozone finance ministers aimed to specify a “road map” on the debt relief measures at the May 24 meeting to secure the IMF’s participation in the Greek bailout rather than finalize a full three-stage debt relief program.
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