Athens Digest 15.11.2018

• EWG discusses 2019 draft budget

• Greece sails past budget target

• Stocks hits by bank index relegation

# The Eurogroup’s working group meets today to discuss Greece’s 2019 draft budget _ with the Commission expected to accept a Greek request to postpone pension cuts but also implement a mix of policies needed to produce the target primary surplus target of 3.5 percent. With other members of the group unlikely to raise objections in such case, the government is expected to proceed with submitting a finalized draft of the budget to parliament. But pensions may soon be considered secondary to other concerns. The first enhanced surveillance programme report for Greece is expected next week amid emerging worries over a series of Greek court decisions reversing several bailout-era pay cuts and recent promises by the government to ramp up public sector hiring ahead of the next general election. Those issues are due to be discussed on a December 3 Eurogroup meeting.

# Greece has sailed past a primary budget surplus target set for central government by nearly EUR 3 billion to reach EUR 6.46 billion euros in the first 10 months of the year. The October data reported by the Finance Ministry suggested the government was on target to beat its required primary surplus of 3.5 percent. It showed that January-October tax revenue was EUR 839 million over target at EUR 42.43 billion euros. Spending was slightly below target at EUR 40.78 billion. Central government data does not include a local government or social security funds.

# A banking share sell off pulled the Athens Stock Exchange’s general index down 1.45 percent to 644 points as three of Greece’s big four lenders lost their MSCI Standard index ranking and moved to the MSCI Small Cap Index. Bloomberg, meanwhile, reported that two parallel plans to rescue banks from the non-performing loan mountain are being considered by Greece’s authorities, one by the central bank and one by the month by the Hellenic Financial Stability Fund.



On our Radar: Simitis says targeted by slander campaign
Former Prime Minister Costas Simitis maintained he was the target of a slander campaign following reports that a money laundering agency has sought access to his banking records along with those of relatives and former associates. The reported action follows the jailing of Yannos Papantoniou, who served as minister of finance and defence in Simitis governments, on corruption charges. In a reference to the government, Simitis said in a statement released by his office: “History is not written by the temporary occupants of the executive branch,” And he added: “Obviously, I would welcome any investigation of my accounts is welcome. I have nothing to hide.”