Monday

18th Jun 2018

Greek MPs unlock bailout tranche

  • Over half of the money is due to go back to lenders (Photo: YoungJ523)

Greece has fulfilled the last of the conditions it needs to secure the latest tranche of its EU-IMF money, putting an end to weeks of internal dispute over yet more austerity measures.

Deputies in the parliament on Thursday (25 July) adopted a new tax code and included an amendment that wraps up the details of a controversial plan to put thousands of civil servants into a "redeployment" scheme.

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The move means that 4,200 public sector employees can be put in the programme by the end of the month.

Athens is due to receive €5.8 billion, reports Reuters.

This includes €2.5 billion from the eurozone's "EFSF" rescue fund, €1.5 billion in bond profit returns from eurozone central banks and a further €1.8 billion from the International Monetary Fund (IMF).

The country has been negotiating the details of this latest tranche for almost two months. Tensions reached a high point last month in Greece when Prime Minister Antonis Samaras announced he was shutting down public broadcaster ERT in a bid to meet promised job cuts in the public sector.

Greece's EU lenders maintained the pressure to make the public sectors cuts until the end with Germany on Wednesday still saying that Athens had to undertake some "outstanding" measures.

The parliament vote on Thursday means that eurozone officials can approve the €2.5 billion tranche on Friday before expected approval by the German Bundestag on Monday.

However, Greek daily Kathimerini reports that more than half of the money will go straight back to lenders.

Around €2.26 billion is to be put aside to pay for maturing bonds held by the European Central Bank and national central banks, said the Greek newspaper.

Germany stalls Greek bailout money

Germany is stalling the payment of a €2.5 billion bailout tranche to Greece, pending further job cuts in the public sector.

Greek bailout exit takes shape

At a meeting next week, eurozone finance ministers and the IMF are expected to agree on new cash, debt relief measures, and a monitoring mechanism to ensure that Greece can live without international aid for the first time since 2010.

Analysis

Beyond US dispute, EU still aiming at China

On the day it outlined its reaction to US tariffs on steel and aluminium, the EU commission also launched a case against China on property rights - an issue on which EU and US are working hand-in-hand.

Opinion

Eurozone needs institutional reform

Both the examples of Greece and Italy test the limits of a system with inherent weaknesses that feeds internal gaps, strengthens deficits and debts in the European South, and surpluses in the European North respectively.

Opinion

Europe could lose out in North Korean bonanza

South Korean businesses including Hyundai and Samsung are already scoping investment opportunities. Will North Korea become a 'new Vietnam' opportunity - or more like Myanmar, where slow Brussels policy-making meant EU exporters lost out.

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