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28/09/2016

Tusk urges Greek debt deal ‘very soon’

Euro & Finance

Tusk urges Greek debt deal ‘very soon’

Shinzo Abe and Donald Tusk [European Council]

Council President Donald Tusk urged the eurozone yesterday (3 May) to swiftly close talks on fresh reform measures for debt-hit Greece, saying it would help global economic stability.

“I urge finance ministers to reach an agreement very soon,” Tusk told reporters as he entered talks in Brussels with Japanese Prime Minister Shinzo Abe and European Commission chief Jean-Claude Juncker.

“And I hope that by the end of May, when we meet at the G7 summit, the implementation of Greece’s programme is positively assessed. I want to encourage all the ministers and institutions to re-double their efforts in finalising the review.”

Eurozone finance ministers are due to meet on 9 May to try to seal a deal on the first review of Greece’s June 2015 bailout, talks on which have been stalled since the end of last year.

Eurogroup to meet over Greek bailout on Europe Day

The next meeting of eurozone finance ministers to discuss Greece’s massive bailout will be held in Brussels on 9 May, Athens said yesterday (28 April).

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The ongoing negotiations between Athens and its EU-IMF creditors are currently stuck on a demand that Greece commit to an extra set of reforms in case it misses its spending targets in 2018.

These so-called “contingency measures” are a key demand of the International Monetary Fund to complete the bailout’s first review, which will unlock billions of euros for cash-strapped Athens.

“We need to make sure that Europe contributes to stability rather than global instability. We should do all in our power to dispel uncertainties,” Tusk added.

“There is no doubt that a successful completion of the ongoing review of Greece’s programme would strengthen confidence.”

Hopes are high for a deal next week but officials warned there was still work to do.

“I think it requires a lot of energy, a lot of work, but I think there is a way,” EU Economics Affairs Commissioner Pierre Moscovici told reporters in Brussels.

“I wish to express a reasoned optimism, these are not easy issues,” added Moscovici.

In Berlin, German Minister of Finance Wolfgang Schäuble assured that “this year there will be no great Greek crisis”.

Greece is on the path towards perceptible progress, he said in comments run by German news agency DPA.

With an agreement, eurozone governments would unlock funds that would allow Greece to make two big payments to the European Central Bank this summer.

They would also then embark on talks to offer Greece debt relief, one of the only concessions allowed leftist-led Athens in the bailout agreed in July.

In new growth forecasts published on Tuesday, the European Commission said that Greece will be the only eurozone member in recession this year with a contraction of 0.3% as fallout from the debt crisis continues to affect its economy.

Greek public debt is estimated to rise to 82.8% of GDP, an unwanted eurozone record.