The Board of Directors of the European Stability Mechanism on Friday approved in principle the disbursement of the last tranche of bailout loans to Greece, worth 15 billion euros.
In an announcement, the ESM said that the disbursement of the loans is subject to completion of the national procedure. “Once the national procedure is completed, disbursement will follow through immediately, ahead of completion of the ESM programme,” it said.
Klaus Regling, speaking to reporters after a Eurogroup meeting on Thursday, said that “the fact that the national procedure in Germany has not been closed is linked to the decision by the Greek government not to increase the VAT rate on five islands. That was one of the 88 prior actions, and after the last Eurogroup that measure was taken. We all know that the amount is not very big – it’s 28 million euros. We do have the commitment from the Greek authorities that the VAT rate will be raised at the end of the year, so it’s a postponement by 6 months. And also Greece in today’s Board of Governors meeting made a commitment to have budgetary savings in other areas of an equivalent amount, 28 million, so that on a net basis, the fiscal situation will not be changed. And that was an important step that will hopefully also enable Germany to conclude its national procedure”.