Athens Digest 09.04.2019

• Centeno says “no reason” for Greece to lower primary surplus target

Novartis probe: 4 to be cleared over lack of evidence

Reports: Hellenic Petroleum privatisation path uncertain

# Mario Centeno, the Eurogroup president, says Greece should not seek to change primary surplus targets, despite backing for a reduction by the two main Greek political parties. “We have to stick to these commitments and I don’t see a reason for these to change in the near future,” he told Open TV. Centeno was more cautious when asked whether Athens would be held to its pledge to raise the tax threshold in 2020. “We must manage the space that we have to take measures in a very sustainable way,” he said. “We need to be very careful at the moment of changing the overall plan because there are many people who will be looking at it.” On the question of early IMF loan repayment, Centeno said the idea was “very wise” and cited the successful post-bailout examples of Ireland and his native Portugal. (video here, scroll to 0.20)

# The findings of a judicial investigation into the alleged involvement of senior politicians in a corruption scandal linked to Swiss drugmaker Novartis are due to be submitted to parliament today with a request to strip former Socialist health minister Andreas Loverdos of his parliamentary immunity. Allegations against other politicians _ former ministers Evangelos Venizelos, Andreas Lykourentzos, Giorgos Koutroumanis and former caretaker prime minister Panagiotis Pikrammenos _ were not supported by sufficient evidence. The investigation against the most senior politicians implicated by confidential witnesses is ongoing, however, and due to be completed in April. The remaining politicians still under investigation are: Former PM Antonis Samaras, EU Commissioner Dimitris Avramopoulos, Bank of Greece Governor Yannis Stournaras, former health minister Adonis Georgiadis, and former deputy health minister Marios Salmas. The developments triggered a new round of intense political controversy. Andreas Loverdos referred to a “policy of a gang.” In a statement, New Democracy party argued that “it the greatest machination a Greek government has ever set against its opponents.”

# Government officials are reportedly considering scrapping plans to privatise Hellenic Petroleum as one option to be discussed with bailout institutions during a visit by inspectors next month. The deal worth an estimated EUR 1.3 billion was thrown into doubt last week when Greece’s privatisation agency announced that no binding bids had been received for a 50.1 percent stake in the oil refiner. Swiss-based commodities and mining firm Glencore partnered with CIEP Participations had been on the short list along with oil trader Vitol joined by Algeria’s Sonatrach. Local media reports, citing Greek government sources, said all options for the privatisation remained open, with the government arguing that the sale of the company would not represent a structural reform but had only been planned to help pay down the national debt. Hellenic Petroleum, meanwhile, along with Spanish energy company Repsol are to sign agreements in Athens today for the oil-and-gas exploration and exploitation rights in two areas of the Ionian Sea.

On our Radar: Greek Bond in Limelight
Greek government bonds are back under an international spotlight, but for once it’s for a good reason. The yield on the country’s 10-year bond dipped below 3.5 percent, to its lowest point in 13 years. Investors are turning to government bonds amid anxiety over European economies fuelled by Brexit concerns and a manufacturing slowdown in Germany. Greece has been helped by its recovery, as the country mulls its next market test after two successful auctions this year.