Brussels, 20/07/2015 (Agence Europe) - On Monday 20 July, the European Commission confirmed that the bridge financing of €7.16 billion from the European Financial Stability Mechanism (EFSM) had been granted to Greece that morning, allowing the country to avoid missing a further payment deadline.
This meant that Athens was able to pay back the ECB (around €4.2 billion) and to settle its arrears to the IMF (around €2 billion) and the Bank of Greece (€500 million) (see EUROPE 11362).
The 'institutions' (Commission, ECB and IMF) held a videoconference with the Greek authorities on Sunday 19 July. For the time being, discussions are focusing on the working method to apply to the negotiations aiming to conclude, in a few weeks' time, a bailout plan under the European Stability Mechanism (ESM). The experts of the representatives of Athens's creditors have not yet set off for Athens.
New measures expected for 22 July.
The Greeks are to submit a second round of prior measures and are consulting the 'institutions' about doing so. According to the declaration of the Eurozone Summit of 12 July (see EUROPE 11358), the Greek Parliament is to adopt the following measures, no later than Wednesday 22 July: - a Code of Civil Procedure aiming to speed up and reduce the costs of legal proceedings; - the legislative text transposing the 'BRRD' directive on the national bank restructuring and resolution schemes. The 'institutions' have already had sight of the draft transposition text.
According to Bloomberg, there will be no vote on texts relating to the Greek pensions regime or taxation on farmers, measures which did not feature in the Eurozone Summit declaration.
As a first sign of a return to normal, the Greek banks reopened their doors on Monday. The Greeks may now withdraw up to €420 a week, as opposed to €60 a day. However, bank transfers abroad are still not possible.
Government reshuffle. Panagiotis Lafazanis, minister of productive reconstruction and described as the leader of the group of 39 rebel MPs who rejected the Eurozone agreement last week (see EUROPE 11361), hands over to Panagiotis Skourletis, formerly the employment minister. He in turn is replaced by Georges Katrougalos, who was previously the minister-delegate for administrative reform. To replace Nadia Valavani, minister-delegate for the finance ministry, who stepped down last week, Triphon Alexiadis, previously chairman of the tax officers' union, has been appointed. Euclid Tsakalotos is confirmed as finance minister. Lastly, Gabriel Sakellaridis leaves his post as government spokesperson to Syriza MP Olga Gerovassili.
When asked on Monday about the possibility of early elections in Greece, the Commission declined to comment.
Public debt to be discussed in the autumn. Speaking on German television on Sunday, the German Chancellor, Angela Merkel, said that the question of any further lightening of the Greek debt burden would be discussed once the first monitoring mission of the bailout plan, currently being negotiated, has been completed. But there is no question of a haircut on the debt instruments held by the creditors of Athens, in line with the agreement of the eurozone. The President of the Commission, Jean-Claude Juncker, said that this controversial issue could be on the table in the autumn.
For now, the eurozone will be focusing on the question of servicing the debt (increasing maturities, cutting interest rates). In its analysis of the viability of Greek debt, it is expected to move away from the debt/GDP ratio which has so far functioned as a reference and under which specific targets were laid down in November 2012. (Elodie Lamer)