Thursday

9th Apr 2020

Greece repays IMF, but future funding in doubt

  • IMF meeting: Athens has €2.5 billion of other repayments this month and €3 billion in May (Photo: imf)

Greece on Thursday repaid (9 April) €448 million to the International Monetary Fund (IMF), amid ongoing talks in the EU capital, Brussels, on proposed reforms and extra bailout funds.

The IMF installment is repayment of a loan from the first Greek bailout in 2010 and part of €3 billion of total loan and bond payments due this month.

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  • Finance minister Yanis Varoufakis says Greece needs a "fiscal plan that makes sense". (Photo: Council of European Union)

Greece needs to pay a further €1 billion in May and fund €1.5 billion of civil servants’ salaries and pensions each month.

It suceeded in selling new debt on Wednesday and, Greek sources told the AFP news agency, will meet all of its April repayments.

But things do not sound so rosy in Brussels.

The Greek delegate to a Eurogroup officials’ meeting, on Wednesday, said Greece’s liquidity is "getting really bad" and that it needs some bailout cash before 24 April, Reuters reports.

The Euro Working Group (EWG), which is preparing for the 24 April meeting of finance ministers, also examined reforms proposed by the Greek government to unblock €7.2 billion in extra loans.

The meeting produced conflicting reports.

Greece’s Kathimerini newspaper says the EWG gave Athens "an ultimatum of six working days to present its proposals … in the fields of social security, labor relations and privatisations”.

But one Eurozone official denied there is an ultimatum.

"There was no ultimatum. The six day period refers to the the time left to secure an agreement before the 24 April Eurogroup meeting in Riga," the source told EUobserver.

The coming days will be the Orthodox Easter weekend, which will automatically reduce the number of "working days".

The source added that the Riga meeting is not a deadline for an agreement anyway.

"The Greek side seems to be expecting an agreement at this meeting but it is not a formal deadline," the official said.

Meanwhile, in Athens, government sources also denied any pressure from the EWG.

"Of course we have differences over labour market, social security or privatisations, but nothing that would create a deadlock or a situation of blackmail," a ministry of finance official told EUobserver, adding that common ground had been found.

Speaking in Paris where he visited the OECD, Greek finance minister Yanis Varoufakis noted that Greece is "keen" to sign an agreement, but that "at the very same time [Greece] needs a fiscal plan that makes sense".

Varoufakis also said Greece would start privatisations soon - a move that could help reach an agreement with the eurozone.

But Greece’s eurozone partners are still waiting for concrete evaluations of the proposed reforms and talks are set to continue with no clear outcome in sight.

"This is the moment for work. The timeline is set. Everybody works 24/7 to make it happen," EU Commission spokesman Margaritis Schinas said at a press conference in Brussels on Thursday.

Asked if the Greek side would work on reform proposals over the Easter weekend, the government official in Athens said "it is a possibility, but maybe not".

"There is of course a sense of urgency. We have to loosen the noose around our neck. But there is no need to run and run”.

Agenda

Trade, Greece and MEPs on stage this WEEK

EU institutions are back to work after Easter, with the European Parliament’s legislative committees taking centre stage before a mini-plenary in Brussels on Wednesday and Thursday.

Time running out for Greece, warns euro commissioner

Time is running out for Greece to broker a compromise that will allow it unlock the remaining €7.2 billion in its EU-IMF bailout needed to avoid a default, the bloc’s eurozone commissioner has said.

Analysis

Greece: too much talk, not enough vision

Wild and often contradictory remarks, delays, and internal divisions make the new Greek government a difficult eurozone partner.

Greece risks default in mid-May, S&P warns

Greece will be forced to default on its debts if a deal with its EU creditors is not reached by mid-May, a leading credit rating agency has said.

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