Athens Digest 16.01.2018

• Omnibus bill passed, reshuffle to follow, one MP added to government majority

• Tsipras pledges to “cover losses” for recipients of child benefits with three kids or more

• Government plans to issue 7-year bond after wrapping prior actions to secure next installment

• Opposition leader Mitsotakis attacks the PM over Casino legislation

• Environment Minister Stathakis expects progress with Hellas Gold in April

• Organised retail market in Greece on the rise in 2017


The omnibus bill containing articles on a number of diverse issues from electronic auctions and strikes to casino licensing was approved last night with the votes of the 154 government MPs paving the way for the conclusion of the 3rd review of the Greek ESM program. Among others, the bill establishes e-auctions as the only form of foreclosure, thereby preventing activists from protesting the auctions at courts. It also stipulates that at least half of the active members of the first level unions have to be present in the general assembly to call a strike (while up to now just 1/3 of the members were required to do so). Despite the inclusion of these two controversial articles, the bill was approved without any parliamentary losses for the government. The article regarding strikes was also voted by the independent MP Harry Theocharis. Moreover, independent MP Theodora Megalooikonomou, former MP of Enosi Kentroon, joined last night the parliamentary group of Syriza as a partner, increasing government majority to 154 MPs.
PM Alexis Tsipras will now have to deal with the resignation of Deputy Education Minister (and ANEL MP) Kostas Zouraris submitted on Sunday, after he made offensive comments against two popular soccer clubs. Zouraris’ resignation is expected to be accepted. Commentators tie this development to a possible government reshuffle. Panos Kammenos, the leader of junior coalition government partner ANEL, chose not to speak in the plenary session ahead of the omnibus bill vote though it is premature to say whether this stance is politically significant in connection with the upcoming reshuffle and the negotiations to resolve the FYROM name dispute.

In a move to appease reactions by SYRIZA MPs caused by the cuts in child benefits for families with three children or more, Tsipras pledged to cover losses later this year. “For those who will suffer some minor cuts, we are ready to make relevant announcements in the coming months, as we will look at solutions to compensate for the losses in 2018” he said.

After the approval of the omnibus bill, a set of circulars and ministerial decrees are expected to follow in the coming days, covering all remaining prior actions for the conclusion of the third review. The aim is to secure a political decision on the Eurogroup of January 22 for the disbursement of the next bailout installment in early February. According to Ministry of Finance sources EUR6.7 billion are expected by the ESM: EUR3.3 billion for debt servicing, EUR1.5 billion to cover state arrears and EUR1.9 billion for the “cash buffer” needed for the post-bailout period, after August 2018.
Crucially, Athens expects an upgrade of its credit rating by Standard and Poor’s on Friday, January 19. After the January 22 Eurogroup and well before the general election in Italy (March 4), Greece’s Public Debt Management Agency (PDMA) plans to issue a new bond with a maturity of 7 years so as to raise approx. EUR2 billion. On another note, the Greek Finance Ministry reported a primary surplus (on a modified cash basis) of EUR1.97 billion in the 12 months from January to December 2017, compared to a target of EUR877 million.

New Democracy leader Kyriakos Mitsotakis attacked the PM for the provision included in the omnibus bill that allows casinos to provide loans over EUR50,000 to gamblers so that they can keep playing. In his sharp criticism of government policy, the opposition party leader referred to, among others, the lost leftist identity of the party of Syriza.
Meanwhile, Nikos Zorzos, mayor of Santorini, publicly opposed the plans to issue a permit for a casino on the island.

Environment Minister Giorgos Stathakis said in an interview that the arbitration process between the Greek state and Hellenic Gold will probably be completed in April. He also clarified that there are two contested issues: whether the company can produce gold in Greece with the technology that it suggests, and whether this technology is compatible with environmental legislation.

According to Nielsen market research, the total value of organized retail market (grocery stores of at least 100 sq.m. in continental Greece and Crete) in 2017 grew by 1.6% compared with 2016. This rise was primarily facilitated by the positive trend prevailing in the market from mid-September onwards, after many years of negative performance.



On our radar: Possibly today, an Athens administrative appeals court will rule over the legality of the detention of a Turkish military officer who was granted asylum by Greek court. Suleyman Ozkaynakci, one of the 8 Turkish servicemen who fled to Greece following failed coup attempt in Turkey, was granted asylum but this decision was suspended temporarily by a court of appeals, for reasons of national interest. Immediately after the decision to suspend his granting of asylum, he was detained by the police, following a court decision. The Turkish side has put a lot of pressure on the Greek government to hand over the officers, who are accused of organizing and participating in the failed coup attempt of July 2016.