Athens Digest 21.09.2018

• Govt holds out for ‘acceptable solution’ on pensions but IMF says commitment key for markets

• Macedonia-name deal could reach parliament “after the end of January” says Foreign Minister Kotzias

• Latest poll gives Conservatives near double-digit lead, race narrows to fewer parties

# Speaking to investors in London, Finance Minister Euclid Tsakalotos said Greece was hopeful it would find an “acceptable solution” with lenders and scrap planned pension cuts in 2019. The ministry, he said, expects the primary surplus to overshoot the 3.5 percent target this year by a similar level to last year. The IMF argues that pension reform is needed to boost market confidence. Gerry Rice, the IMF spokesman, told reporters at a regular briefing that sticking to the commitments would send a “clear signal” to investors as the country prepares to make a return to markets.

# The agreement with FYROM could be sent to Greece’s parliament for ratification “after the end of January” next January, Foreign Minister Nikos Kotzias said after talks with Germany’s Heiko Maas. The German foreign minister travelled to Skopje and Athens to express support for the deal. He was the latest in a long line of senior western officials to travel to the area to back FYROM Prime Minister Zoran Zaev’s campaign for a ‘yes’ vote in the Sept. 30 referendum. A week ago, the President of the Parliament Nikos Voutsis said that the agreement will be brought to Greek Parliament for ratification in February or March.

# A poll by Pulse company for private SKAI TV has given New Democracy a 9.5-point lead over Prime Minister Tsipras’ Syriza party (31.5 vs 22 percent). The extreme right Golden Dawn polled third with 7 percent, ahead of the Movement For Change on 6.5 percent and Greek Communist Party on 5.5 percent. Others fell below the 3 percent threshold.

# Recent polls, conducted after the bailout exit as well as the deadly summer wildfires, have all showed that Conservatives maintain a clear lead but Tsipras has narrowed the gap which has been reported from 4.9 to 10.9 points. A key issue remains the number of parties likely to win seats in the next election. Polls suggest only five out of the current eight parties in parliament will probably regain representation (with Potami, the Independent Greeks, and Centrist Union are all poised to exit). Fewer parties would boost the winner’s chances of outright victory and potentially affect the alignment of support needed for parliament’s election of the next president in 2020.

On our Radar: Citi sees Greek growth slowdown
Challenging budget targets and tough post-bailout surveillance are likely to put the brakes on Greece’s growth rates through 2022, Citigroup has warned. As part of its global forecast for selected world economies, the bank report said it expects growth in Greece to decline steadily from 1.9 percent this year to 1.4 percent in 2022 _ staying below the eurozone average despite years of recession and stagnation.