Athens Digest 30.07.2018

• Long term outlook of Greek debt remains a concern for IMF

• Wildfire death toll rises to 91, while 25 officially confirmed missing

• Greece to start talks with Japan for purchase of firefighting planes

• Tourism on the rise, but weak Turkish lira a concern for hoteliers


# According to reports, the IMF’s executive board confirmed on Friday that Greece’s debt is sustainable in the medium term thanks to new debt relief measures until 2032, but expressed reservations about the long term outlook. The IMF report (Article IV) on the Greek economy will be released tomorrow. The Fund has repeatedly said that Greece should focus on the implementation of growth-friendly reforms in the post bailout – programme period and the management of the NPLs.

# The death toll of the devastating wildfire in Attica last Monday has climbed to 91, while Greece’s fire service announced yesterday that 25 people are still missing. It was the first official confirmation of the number of missing, six days after the fire. The lack of official information on the missing fueled speculation that the number of dead could be far higher. Meanwhile, work will begin tomorrow to demolish the destroyed buildings, while households affected by the fires will begin submitting applications for a EUR 5000 lump sum in aid. Families with more than two children will receive 6,000, while businesses will receive 8,000.

# Japan will start negotiations with Greece for the sale of US-2 rescue planes, according to a report in the Nikkei Asian review. Nikkei said that Greece wants to replace its ageing fleet of firefighting aircraft and has expressed interest in purchasing the amphibious rescue planes from Japan’s Shin Maya Industries. The report added that the aircraft will be fitted with water tanks before they are sold to Greece. Nikkei cited a Japanese official who said that Athens will seek financial assistance from the EU to buy the aircraft, priced at slightly more than YEN10 billion.

# The tourism sector is helping Greece emerge from its financial crisis but the decline in the Turkish lira is a source of concern for Greek hoteliers, according to Handelsblatt. The report said that the number of tourists arriving at Athens International Airport in the first half of 2018 increased by 10.5 percent. The paper said that tourism revenues are rising steadily and that the number of visitors could reach 35 million this year – adding that the deadly fires last week near Athens did not lead to any cancellations. However, it added that tourists are returning in their droves to Turkey due to its low prices. This is mostly understood by hotel owners in northern Greece, where the Russians were the largest group of visitors in most places last year.



On Our Radar: Cabinet reshuffle on the cards as government seeks to contain political backlash
The political backlash over last week’s deadly fire has fuelled speculation that a cabinet reshuffle is imminent –before the Thessaloniki International Fair in early September. New Democracy, as well as the other opposition parties, accused the government of “hiding the truth” when it first found out that people had died in the fire. The government dismissed the allegation, denouncing ND and its affiliated media for using the tragedy for political gain. But the government has come under increasing pressure. On Thursday, Premier Alexis Tsipras took full “political responsibility” but critics said this was too little too late and accused the government of trying to shrug off responsibility.