Brussels, 07/11/2014 (Agence Europe) - There was a brief discussion at Eurogroup on Thursday 6 November about the end of the Greek aid programme, but ministers focused on the fifth troika monitoring mission in Athens (European Commission, European Central Bank and International Monetary Fund).
Eurogroup's message was clear: Greece must throw its weight into helping the troika conclude its monitoring mission ahead of the 8 December Ecofin Council. If the deadline is met, Eurogroup will be able to agree on the follow-up to the Greek structural adjustment programme, which is due to be concluded at the end of the year
On Greece's exit from the aid plan: “Our positions are clearly converging. Taking into account the still fragile market sentiment and the many reform challenges that still lie ahead, there is a strong support for a precautionary credit line in a form of an existing ESM tool called ECCL (Enhanced Conditions Credit Line),” explained the head of Eurogroup, Jeroen Dijsselbloem. ECCLs have tougher strings attached than PCCLs, along with regular monitoring missions to ensure the corrective measures are being properly implemented (see EUROPE 11189). There has been debate this year about flexibility under the Stability and Growth Pact, and a diplomat said that although Eurogroup was planning to stick to the ESM rules, its favours a degree of flexibility under the ESM.
Dijsselbloem said: “There is broad understanding that the IMF needs to continue being involved and further discussion will have to take place on the exact form of this involvement.” Finland is reported to have insisted on this issue at the Eurogroup meeting. Dijsselbloem said that IMF involvement strengthened the eurozone's credibility over what it does for Greece. Several countries feel that IMF involvement along the lines of the aid plan for Spanish banks would be too “light.” Greece wants to shuffle off IMF involvement and exit the IMF aid programme early (it is scheduled to end next year) at the same time as its exits the eurozone aid plan.
Reuters reported on Thursday that there were three options on the table for ending the Greek aid programme, but in reality these amount to just two options, namely the ECCL credit line or, as mooted by Greece, enhanced surveillance under the Two-Pack.
Economic and Financial Affairs Commissioner Pierre Moscovici said that everyone feels that it is time to put an end to a kind of micro-management, but at the same time, Greece needs support. He expected the troika to return to Athens before next weekend (in other words, before the middle of the month). The troika is expecting the Greek government to take action before it returns. “The Greek authorities have presented a package of further measures, while significant progress, more remains to be done,” said Dijsselbloem. He pointed out that when the mission is over, the eurozone will be able to put a figure on what is needed for Greece and to examine sustainability of the country's debt. A source says that the eurozone tends to feel that an easing of the Greek debt burden by the eurozone is not needed at this stage. (EL)