Negotiations continued on Monday between representatives of institutional creditors and Greek government officials to finalize measures in a 5.4-billion-euro package until 2018, while a mini Cabinet meeting took place in the morning over lenders’ latest demand for a “contingency package” worth another 3.6 billion euros.
The Greek government, according to reports from Athens on Monday, is trying to desperately avoid the prospect of bringing the contingency package to Parliament for approval, given that sharp criticism has already emerged in the country – despite a news "black out" over the airwaves due a to journalists’ union strike – charging that a “fourth memorandum” was delivered via the backdoor.
Additionally, as “N” reported this past week, the leftist Greek government wants the next review of the Greek program (third bailout) to come in a year and to coincide with the next batch of figures by Eurostat for the annual Greek primary budget surplus target.
The government’s alternative to legislated contingency measures is designating an up-until-now obscure entity, the Council for Fiscal Policy, as the watchdog for fiscal oversight and the determining body for when to activate automatic contingency cuts.
On the negotiations’ front, pension reforms were still not finalized, while creditors reportedly continue to demand an expansion of the tax base downward, below the 9,000-euro figure the government was willing to go. Creditors have long pointed out that the vast majority of Greek taxpayers enjoy a tax-free status due to the previous 9,545-euro ceiling.
Meanwhile, other negotiations center on the creation of a “super fund” where whatever proceeds from privatizations will be directed in order to slash the country’s foreign debt.
The last chapter before an agreement on non-performing loans revolves around protection of primary residences already partially protected under a previous legislative relief bill, but only for a period of time extending to 2017 or so. If reports are accurate, such a position would be a dramatic withdrawal from previous government position of excluding a variety of loans – corporate, business, retail, personal, mortgages – from distress funds’ reach.
The latest unofficial target for concluding negotiations for the first review at the technical level are Thursday, while other reports have indicated even Sunday, May 1, which is Easter Sunday in Greece.
