Athens Digest 08.05.2018

• Parliament set to hold ‘exit debate’ on eve of Eurogroup

• Syriza official revives speculation of early election

• Court challenges ‘won’t delay’ Athens coastal development plan, says deputy minister of economy

• Equity fund claims land accessory-maker Folli Follie in hot water


# Parliament is set to hold a debate on ongoing negotiations between Greece and creditors _ with a plenary session earmarked for May 22 or 23, on the eve of the next Eurogroup meeting. The debate was requested by Socialist leader Fofi Gennimata, who argued that political parties had to make their respective positions clear before major decisions were taken.

# Parliament’s Budget Office, meanwhile, issued a quarterly report warning that the recovering economy remains vulnerable to possible disruption caused by international trade disputes, as well as to a possible flare-up of the refugee crisis. The economy, it said, was set to grow by 2 percent in 2018, slightly lower than the government forecast. The severity of tax and social security authorities in the collection of public revenues should be strictly kept, it added. It is the first report after Fragiskos Koutentakis, former Secretary General for Financial Policy, was appointed by the government as Head of the Office.

# Officials in the government have dismissed a call for snap elections made by Gennimata, leader of the Socialist Movement for Change, but renewed speculation that an early poll is being considered. Nikos Xydakis, parliamentary spokesman for the governing Syriza party, said an election held any time after the August bailout exit would not be considered as being “early” as it would mark the end of a “great chapter.” Xydakis, a former deputy foreign minister, said Greece would honour commitments made to bailout creditors, but added: “After August, everything is political … depending on the fiscal space, there may be some room for manoeuvre.”

# Multiple legal challenges to the Hellenikon coastal development project south of Athens will not push the project further behind schedule, a senior government official said. Stergios Pitsiorlas, the deputy minister of economy, said a tender for the casino at Hellenikon would be launched in the summer and that construction _ following various pending join ministerial decisions _ is still expected to start in October. “The bulldozers will be there soon,” he told Parliament TV.

# Greece’s Capital Market Commission said it will investigate the accounts of Athens-based luxury accessory-maker Folli Follie after its stock price was hammered amid a dispute with an American equity fund. The commission said it would use an independent auditor in the investigation, after Folli Follie’s share price fell by nearly 30 percent in Athens, on a second day of major losses. New York-based Quintessential Capital Management accused the company of grossly inflating the size of its Asian operations. In response, the Greek company called the fund’s allegations “unfounded, false, defamatory, and misleading.”



On our Radar: Households still hemorrhaging
The gap between Greek household consumption and disposable income was further broadened in 2017 to its worst level since the crisis began, according to Eurobank research. It found the gap had widened to EUR 8.3 billion last year, marking a sixth straight year of negative results, and exacerbating the cumulative decrease in the household savings stock, now equivalent to a loss of wealth worth EUR 32.5 billion between 2011 and 2017.