Some Progress Made in Greece-Creditors Talk, Thorny Issues Remain Pending

Wednesday, March 8th, 2017
Last Update: 11:22

Tuesday’s talks between Greece and international creditors ended late at night with the two sides finding some points of convergence, while the differences in the thorny issues remained.

When the teams of creditors were ready to leave Athens on Tuesday evening, a last-minute effort by the Greek team managed to bring them back on the negotiating table. Talks started at 4 pm and ended after midnight. And while there was no convergence on the “difficult” issues, a step in the right direction was made, according to a government official close to the talks.

The two sides negotiated the progress of the bailout program until 2018. The fiscal gap projected for 2019 and the measures that would be required then will be discussed at a later time.

There was no progress whatsoever on the issue of changes in the labor market, with the Greek team insisting on European laws. However, it seems that lenders will finally agree to leave the issue pending and discuss it at a later date.

Government spokesperson Dimitris Tzanakopoulos on Wednesday said that Athens is close to a staff level agreement, even before the March 20 Eurogroup.

Speaking on SKAI television, Tzanakopoulos said that there are still disagreements on labor law reforms and the measures required after the end of the current bailout program in 2018. He said that both sides made concessions and they are close to convergence.

Tzanakopoulos reiterated the government’s position that the International Monetary Fund is making illogical demands. He further said that as of January 1st, 2019 there will be some changes in taxation that will burden some taxpayers and benefit others but they will have zero fiscal impact.

A staff level agreement, however, is not sufficient for the disbursement of the next loan tranche. This is a decision that only euro zone finance ministers can make. The Greek side appears optimistic that the review will close sooner than later and the bailout tranche will be disbursed on time, definitely before July, when Greece has to pay 6.3 billion euros on loans.

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