Mood in Brussels now optimistic over final agreement between Athens, creditors

The mood in Brussels on Tuesday over the course of the Greek program was satisfaction and optimism that a final agreement will be achieved by May 24 to allow a resumption of financing of the credit-starved Greek state by institutional lenders.

Tuesday’s extraordinary Eurogroup meeting ascertained progress in the measures announced and ratified by the Greek government, with the first official discussion taking place at the same venue on the issue of Greek debt relief, phrased as “sustainability” in the Eurogroup agenda.

However, reports from the Belgian capital reiterated that the IMF has still not given its approval for debt relief in three stages. The Fund has publicly maintained that debt relief for Greece is imperative for it to remain as a lender to the country, and therefore wants a comprehensive solution.

Nevertheless, Tuesday’s Eurogroup session, which focused exclusively on the Greek program (third bailout) was seen as important by European institutions, given that a possible re-emerged crisis revolving around Greece’s finances would have come shortly before a June 23 referendum on Britain’s EU membership and with the refugee crisis still simmering.

Moreover, the agreement at the Eurogroup level for a “road map” to deal with Greek debt relief was termed as a very important piece of progress by a Commission spokeswoman, who added that the foundations for an overall deal were set ahead of the May 24 Eurogroup meeting.

According to EU sources in Brussels on Tuesday, the IMF has agreed with European institutions over the 5.4-billion-euro package of tax hikes and pension reforms unveiled by the Greek government, and passed in Parliament over the weekend. Additionally, the IMF was reportedly coaxed into agreeing with the formula for a 3.6-billion-euro “contingency package” in case Athens fails to meet fiscal goals through 2018.