The French finance minister, Michel Sapin, believes that the Eurogroup should start looking now at possible medium-term relief measures for the Greek debt, even though application is not planned until the third Greek bailout plan is finalised in 2018.
Tackling this issue is vital to maintain the pace of the agreement and give Greece new prospects, the minister said on Monday 7 November. Declining to go into greater detail, he acknowledged that the subject had the approval of Greece and was being discussed "keenly" by Germany, whereas the other countries of the eurozone are more or less just observers at this stage.
Under the Eurogroup agreement of May, the debt relief measures, which may be taken in 2018, will include such elements as a 'reprofiling' of the debt (grace periods, extending maturities) and a transfer of the profits (€1.8 billion) held by the ECB in the framework of the SMP programme (see EUROPE 11557). They will require the approval of the national parliaments of the countries which so require, such as the Bundestag born of the German elections of autumn 2017.
On Monday, the European Stability Mechanism (ESM) presented the eurozone finance ministers with the technical work underway on the short-term relief measures for the Greek debt, including a reprofiling of the repayments on loans granted with constant average maturity and a refinancing strategy aiming to reduce risks related to the interest rate.
Klaus Regling, managing director of the ESM, said that it was too early to go into detail, but acknowledged that some measures could have an up-front cost in order to make savings in the longer term. Once finalised, these measures, which will not require the approval of the national parliaments, will be included in the analysis of the viability of the Greek debt, to be presented by the IMF by the end of the year, to allow it to decide whether to come on board the third bailout plan.
Eurogroup President Jeroen Dijsselbloem said that they would know more about these short-term measures, along with Greece's structural reforms and budgetary trajectory, on 5 December. He stressed that the IMF has reiterated its willingness to come onboard. According to European Commissioner for Economic and Monetary Affairs Pierre Moscovici, a global agreement in the framework of the second monitoring mission of the third Greek bailout plan is possible by the end of 2016. He noted progress on the liberalisation of the market for products, a redynamisation of the business environment and the reform of public administration. As soon as Athens fulfils its commitments, the country's creditors will also meet their responsibilities on the matter of the Greek debt, the commissioner had told a small group of journalists earlier. (Original version in French by Mathieu Bion)