Best outcome at Eurogroup would be the institutions’ return to Athens, senior Eurozone source says

Óõíåäñßáóç ôïõ Eurogroup ôçí ÐÝìðôç 14 Éáíïõáñßïõ 2016, óôéò ÂñõîÝëëåò. (EUROKINISSI/ÅÕÑÙÐÁÚÊÇ ÅÍÙÓÇ)

A swift conclusion to the negotiations between Greek authorities and the lenders would be “desirable,” a senior Eurozone official said here on Thursday, but there was no urgent need to conclude the negotiations straight away.

Given the current state of play, the source added, the best possible outcome after Monday’s Eurogroup was the return of the institutions to Athens to complete the review. Once the institutions return to Athens, the source said, it should then be possible to reach a staff-level agreement very quickly.

The source also pointed out, however, that it would take some time before the next tranche of loans to Greece is disbursed, even after a staff-level agreement is reached. The Greek government must first pass legislation implementing the prior actions and it requires ratification by some national parliaments, which may be delayed because of upcoming elections in Eurozone member-states.

The European official pointed out that Greece has currently only implemented a third of the prior actions needed to complete the second review, commenting that “it could be better”.

Asked about the IMF’s participation in the Greek programme, the source said the IMF’s management was expected to ask the Fund’s executive board to approve a programme for Greece once a staff-level agreement was in place.

“Nothing is guaranteed,” the source replied when asked if there were guarantees the IMF will ask for a Greek programme, while expressing conviction that the IMF’s Executive Board would agree to a new Greek programme if this was sustainable.

On the possibility of an emergency Eurogroup in the case of an agreement, the official said there “was no rush to change the Eurogroup meetings schedule.” There were several more Eurogroup meetings between now and July, the source quipped, “so you can all go skiing without worrying.”