Athens Digest 19.01.2018

• MinFin Tsakalotos met Bank of Greece Governor Stournaras. Α sign of truce?

• Greece has high hopes for Monday’s Eurogroup – IMF and the Europeans in search of a debt relief roadmap

• Deputy MinFin Chouliarakis warns against complacency in the post-programme period

• PM Tsipras meets Archbishop over FYROM’s name dispute ahead of Thessaloniki rally


MinFin Euclid Tsakalotos informed Bank of Greece Governor Yiannis Stournaras about the latest developments concerning the conclusion of the 3rd review of the Greek ESM programme. The Governor referred to the discussions he had during his official meetings in Frankfurt and London. ECB’s approach on the nature of the post program surveillance is crucial, as Greek banks should keep the ‘waiver’ which allows them to maintain access to the central bank’s cheaper loans instead of the more expensive emergency loans. The meeting took place a few weeks after Stournaras was criticised by government officials for suggesting, in the BoG Report, that an ESM credit line could be an effective next option for the country.

According to an EU official, Eurozone Ministers of Finance are expected to approve the conclusion of the 3rd review on Monday’s Eurogroup, which paves the way for the EUR6.7 billion installment in early February. Furthermore, Greece is expecting a reference to the procedure of the medium term debt relief measures. This development as well as today’s expected upgrade of the Greek bonds by Standard & Poor’s may contribute to the success of the upcoming Greek bond issues. Greek MinFin aims to raise approximately EUR9 billion until August and use them as part of the cash buffer needed to secure market access. The IMF and Greece’s European creditors are seen by analysts to be bridging their gap regarding the Greek debt relief measures though “differences remain”, according to the IMF spokesperson Gerry Rice.

During a book presentation, Deputy MinFin Yiorgos Chouliarakis said that Greece should stick to the prudent implementation of the budget, conclude the 4th (and final) review of the current program and avoid any return to the policies that were implemented before 2009 and led to the bailout programmes. He also noted that 2019 will involve a degree of political risk, linked to the possibility of having multiple elections.

PM Alexis Tsipras met Archbishop Ieronymos, who recently insisted on the need to exclude the term ‘Macedonia’ from FYROM’s future name, adding that the schismatic Orthodox Church of FYROM should not use the term either. Nevertheless, after the meeting and ahead of the upcoming rally on Sunday in Thessaloniki, the Archbishop stated: “At this point, no rallies and voices are needed; instead, we need consensus, conciliation and unity”. This could prove a helping hand to Tsipras since a huge rally, comparable to the one of 1992 in Thessaloniki, could hurt the government’s effort to negotiate a solution.

The PM also met Foreign Affairs Minister Nikos Kotzias right after UN Special Envoy Matthew Nimetz put on the table his latest proposals to resolve the FYROM name dispute. There has been no reaction by the Greek government. Yesterday, different name versions were leaked to FYROM’s press, all including the term Macedonia. Meanwhile, President of the Parliament Nikos Voutsis rejected all referendum scenarios on the issue, a position that is quite different from the one expressed by Panos Kammenos, leader of junior government coalition partner ANEL.



On our radar: Oxford friends explore common ground
Bank of Greece Governor Yiannis Stournaras has been under attack by government officials accusing him of following the agenda of the opposition instead of being independent. “It is my institutional obligation to warn of risks”, he responds. The battle for the control of the banking sector is not new. At this point, the government seems to understand that the BoG and the ECB should be its allies on the way to exiting the country’s fiscal programmes. Yesterday’s meeting between Stournaras and Tsakalotos was an attempt to smooth these differences. In fact, the MinFin has carefully avoided adopting the accusations against Stournaras. The two men know each other pretty well, with their friendship dating from the years when both were graduate students in Oxford.