May 9, 2021



Greek debt bargaining continues, solution could come as late as May 12

Greece’s bargaining in Washington D.C. with Finance Minister Yanis Varoufakis’ meetings with International Monetary Fund (IMF) chief Christine Lagarde and U.S. President Barack Obama did not bear the results that had been hoped for.

The IMF appears to be more flexible than the European Union in some matters, but insists on changes to social insurance. The IMF also wants to see a new 20-bln-euro credit credit line for Greece.

The Brussels Group has escalated its pressure and tough negotiations are expected to take place in Paris on Monday. Athens also hopes that the teleconference meeting with the Euro Working Group on Wednesday will bear results.

European Central Bank (ECB) President Mario Draghi is the one holding the “keys” to the release of 1.9-bln-euros benchmarked for Greece, however he states that the government “should help itself”.

It seems unlikely that a deal will be clinched during the April 24 Eurogroup meeting.

New list of measures expected:
* Changes in labor with so-called “smart” work contracts in the private sector with wages to be set according to market conditions, with the hep fo the International Labor Organization.
* Social security changes to early retirement schemes at Public Utilities, banks etc. so that nobody gets pensions before the age of 60, with the exception of mothers with minors in their care.
* An abolition of tax benefits and new monitoring of the tax collection mechanism.
* Privatizations to continue with commitment for a minimum investment from the buyer. Part of the yield from these will go to funds so avoid pension cuts.

The solution to Greece’s economic problems need to be solved before May 12. Despite official denials, there are claims that at least 2 bln euros were missing from public coffers so that wages, pensions and IMF payments can be paid until the middle of May.