Sunday

3rd Dec 2023

Greece's creditors differ on bailout details

  • IMF chief Christine Lagarde (l) and EU Commission president Jean-Claude Juncker (r). The IMF thinks that the numbers are "too soft". (Photo: Consillium)

Eurozone finance ministers are due to meet Wednesday evening (24 June) to try and reach a deal on Greece’s bailout but the creditors themselves are divided and there are worries about final parliamentary approval

The creditor institutions - the EU, the International Monetary Fund (IMF) and the European Central Bank (ECB) - are assessing a Greek proposal sent on Sunday (21 June) and discussing detailed figures and specific measures with Greek experts.

Read and decide

Join EUobserver today

Become an expert on Europe

Get instant access to all articles — and 20 years of archives. 14-day free trial.

... or subscribe as a group

But last minute cracks have appeared between the EU institutions and the IMF over the measures Athens should take to release €7.2bn in bailout money.

The IMF "thinks that the numbers are too soft," an EU source said, referring to the fiscal targets, pensions and VAT levels under discussion.

While EU institutions and member states agree that the latest Greek proposal is in line with the so-called "aide-memoire" drawn up by the creditors at a meeting in Berlin on 1 June, the IMF is said to now demand targets closer to a ‘memorandum of understanding’ signed with Greece in 2012.

"The aide-memoire and the Greek proposal take into account the reality of the current situation," the source said, suggesting the IMF is sticking to out of touch older demands.

With the latest Greek proposal, the source said, "we've gone a lot further than anyone would have hoped a few weeks ago. We have to recognise Greece's serious effort".

"Patience is now appropriate," a diplomatic source told EUobserver to downplay divergences.

"The institutions need to sit around a table and work out an agreement" in time for the Eurogroup on Wesnesday, the source said.

Meanwhile questions arise about how a possible agreement later this week could be endorsed by various national parliaments. Greece's current bailout runs out on 30 June, and it also needs to pay an IMF bill by then.

At least four EU countries - Germany, Finland and Estonia - are required to vote to validate a deal, while the Dutch Parliament will at least hold a debate and maybe a vote.

In any of these four countries, an agreement considered too favorable to Greece could fail to get the green light.

But the Greek parliament itself has to make the first endorsement move – and that is not a given.

"I believe that this programme as we see it is difficult to pass by us," deputy speaker Alexis Mitropolous, a representative of Syriza's radical wing, told Greek TV on Tuesday, raising questions about Prime Minister Alexis Tsipras’ ability to convince his majority

A vote by the Vouli, the Greek Parliament, would be necessary to trigger the disbursement of a €7.2 billion loan. And it could also be necessary to guarantee a positive vote in other countries.

"It is important to have an agreement, but implementing it is also equally important," the diplomatic source said.

Some countries "are sceptical about the already delayed implementation of an overlong programme", and would not validate the agreement before Greece takes so-called "prior action".

These prior actions could be a vote, or at least decrees, to implement measures included in the agreement, such as pension or VAT reform.

According to Bloomberg, the German finance ministry has told euro area officials that Bundestag members could invoke a fast-track procedure but this is likely to depend on the “quality and persuasive power” of an agreement with Greece.

If an agreement is reached on Wednesday or Thursday, a Greek official said, the Vouli could be asked to vote before the end of the week, so as to allow other parliaments to vote on the agreement in emergency procedures as soon as possible.

EU leaders, for their part, will also have their say on Greece when they meet for a summit in Brussels on Thursday and Friday.

Euro summit delays decision on Greek bailout

Eurozone leaders acknowledged that the latest Greek reform proposals were "a positive step", but delayed a deal until later this week and didn't discuss debt relief.

Tsipras in Brussels, as markets fret

Tsipras is holding talks with Juncker, Draghi, and Lagarde in Brussels, but his pessimistic tweet, earlier on Wednesday, caused market tremors.

Greek talks postponed to Saturday

Eurozone finance ministers will meet for the fifth time in 10 days on Saturday after the latest talks aimed at sealing a Greek debt deal were hastily aborted on Thursday.

Greece talks to drag into EU summit

Talks aimed at preventing a Greek default are set to drag into the EU summit, after euro ministers broke off their meeting prematurely.

Opinion

'Pay or okay?' — Facebook & Instagram vs the EU

Since last week, Mark Zuckerberg's Meta corporation is forcing its European users to either accept their intrusive privacy practices — or pay €156 per year to access Facebook and Instagram without tracking advertising.

Latest News

  1. Israel's EU ambassador: 'No clean way to do this operation'
  2. Brussels denies having no 'concern' on Spain's amnesty law
  3. Dubai's COP28 — a view from the ground
  4. Germany moves to criminalise NGO search-and-rescue missions
  5. Israel recalls ambassador to Spain in new diplomatic spat
  6. Migrant return bill 'obstructed' as EU states mull new position
  7. Paris and Berlin key to including rape in gender-violence directive
  8. What are the big money debates at COP28 UN climate summit?

Stakeholders' Highlights

  1. Nordic Council of MinistersArtist Jessie Kleemann at Nordic pavilion during UN climate summit COP28
  2. Nordic Council of MinistersCOP28: Gathering Nordic and global experts to put food and health on the agenda
  3. Friedrich Naumann FoundationPoems of Liberty – Call for Submission “Human Rights in Inhume War”: 250€ honorary fee for selected poems
  4. World BankWorld Bank report: How to create a future where the rewards of technology benefit all levels of society?
  5. Georgia Ministry of Foreign AffairsThis autumn Europalia arts festival is all about GEORGIA!
  6. UNOPSFostering health system resilience in fragile and conflict-affected countries

Stakeholders' Highlights

  1. European Citizen's InitiativeThe European Commission launches the ‘ImagineEU’ competition for secondary school students in the EU.
  2. Nordic Council of MinistersThe Nordic Region is stepping up its efforts to reduce food waste
  3. UNOPSUNOPS begins works under EU-funded project to repair schools in Ukraine
  4. Georgia Ministry of Foreign AffairsGeorgia effectively prevents sanctions evasion against Russia – confirm EU, UK, USA
  5. Nordic Council of MinistersGlobal interest in the new Nordic Nutrition Recommendations – here are the speakers for the launch
  6. Nordic Council of Ministers20 June: Launch of the new Nordic Nutrition Recommendations

Join EUobserver

Support quality EU news

Join us