Shocking: Greek Gov. accepts a total of 9bln Euros measures!
Apr, 18 2016
Author: newsroom
The Greek government has reportedly accepted to discuss an
additional package of measures worth 3.5bln Euros in the event its
proposal to the Quartet to raise 5.4bln Euros through tax hikes fails to
produce any results.
Following extensive contacts between Greece’s Finance
Minister Euclid Tsakalotos and Economy Minister George Stathakis with
IMF and EU officials in Washington, it is becoming apparent that the
Greek side is considering to sign a ‘zero divergence clause’ agreement
with its lenders that would essentially mean it is willing to implement
an added 2.7-3.5bln Euros measures until 2018.
This means if the government fails to deliver on its
fiscal targets through its proposed 5.4bln Euro measures to reach the
agreed primary surplus with the Quartet, an automatic system of measures
would ‘kick in’ to compensate for the fiscal gap. The Greek government
is struggling to close the review of its rescue package to receive a
disbursement by the EU in order to cover its debts that are due in
summer.
According to sources, this ‘automatic compensation
formula’ was tabled by Germany and was presented in the sidelines of the
IMF-World Bank meeting in Washington. The Greek side confirmed that
such a proposal existed, late Sunday and that it was open to discuss it,
if it was accompanied by a promise that a debt relief would be
included.
Sources say the proposal provides that the Greek
government would be compelled to adopt the additional measures only if
the primary surplus goal had not been reached in 2018. Given the
possibility of an additional 3.5bln Euros on top of the agreed 5.4bln,
the Greek people will called to pay a ‘bill’ totalling 8-9bln Euros! The
Quartet is expected to return to Athens on Monday, April 18 with talks
scheduled to resume Tuesday. The goal is to close the review until the
April 22 Eurogroup of in an emergency session of the group on April 26.