Athens Digest 07.06.2018

• Timetable fixed for prior-actions bill ahead of Eurogroup meeting

• Bond issue in hands of debt agency, says government

• Protesters hope to derail Macedonia deal

• God save the planet: In Spetses island, scientists announced Church help in global warming campaign

# Finance Ministry officials say the country’s Public Debt Management Agency (PDMA) has been given discretion over pre-bailout-exit bond issues, denying a report that the government had held up an auction due to the Italy crisis. Reuters reported that the government had been mulling a 10-year-bond issue over the summer but that the plan was now set to be pushed back by several months. In response, Finance Ministry officials said the PDMA would make its decisions based on “technical criteria.” Market turmoil generated by the political crisis in Italy hit Greek bond yields, renewing a mood of caution in Athens.

# Debate on the omnibus bill of bailout-related measures is due to start in parliament at committee level tomorrow, allowing for a mid-week vote next week and for the new measures to formally take effect by June 21. The timetable was confirmed by the government as Mario Centeno, the Eurogroup president, urged Greece to complete pending prior actions so that talks could shift to debt relief that would, he noted, be granted “to the extent necessary.” The Greek bailout exit state-of-play and the country’s debt relief measures will be discussed today during a euroworking group / “Washington group” (institutions and Greece’s main creditors) meeting, today, in Paris.

# Thousands of protesters gathered in cities and towns across Greece in a last-ditch effort to try and derail a deal on the Macedonia-name dispute. The main rally took place at Pella, birthplace of Alexander the Great, where some 3,000 people gathered. The events were much smaller in scale than protests held in late January and early February in Thessaloniki and Athens, but touched off a new round of political confrontation. The conservatives accused the government of making damaging concessions while clinging to power, while the opposition party was attacked in response for allegedly “exploiting nationalism.” A new rally is planned in Athens on Sunday.

# Gathering on a Greek island, top climate change scientists said they had accepted help from the Orthodox Church and leaders of other faiths to step up the worldwide campaign for action against global warming. Experts stressed that the window to substantially reduce carbon emissions was narrowing and that without swift action heavily-populated parts of the planet _ including places like Nigeria and the Philippines _ would become increasingly uninhabitable. The conference on the island of Spetses was organised and attended by Ecumenical Patriarch Bartholomew I, spiritual leader of the world’s Orthodox Christians.

On our Radar: How much do Greek non-viable enterprises cost?
The prolonged and deep economic recession has had an intense impact on the profitability of the Greek corporate sector, which in turn led to a steep increase in non-performing loans and consequently to the creation of a whole “generation” of non-viable or “zombie” firms. In the past, all the attempts to address the problem either from the Greek state or from the banking system have been timid or fragmented, resulting –in most cases – in generating vicious cycles of forbearance and “evergreening” which kept alive a substantial number of enterprises without any realistic hope of recovery.
The urgent need to assess the potential benefit that can be gained from a large-scale restructuring programme of Greek non-viable enterprises is addressed in a Piraeus Bank study which attempts to assess the potential benefits of restructuring non-viable enterprises. The analysis of businesses from 2016 data suggests that non-viable enterprises have trapped productive capacity, as measured by assets, worth EUR 28.4 billion, equivalent to 16.3 percent of GDP. You may find the study here.