Eurogroup to convene on Monday amid moderate expectations on the Greek issue

The Eurogroup will convene on Monday amid moderate expectations on the Greek issue. The IMF does not seem to retreat from its demand for additional measures while the Greek government insists on no more austerity.

As government spokesman Dimitris Tzanakopoulos reiterated in an interview with Realnews on Sunday, “the second programme review must be concluded as soon as possible without additional austerity.”

The eurozone Finance Ministers will discuss the progress in the implementation of the Greek programme on Monday’s Eurogroup as well as ways to continue the review of the second programme, according to the Eurogroup agenda. The Greek issue is third on the agenda.

Following the latest negotiations between the Greek authorities and the institutions, the Eurogroup will seek a political agreement on the conditions that would allow the institutions’ return to Athens to continue the negotiations for the programme’s review. Provided that the agreement is achieved and the institutions return to Athens soon, the technical issues of the second review will close quickly, eurozone sources said. The same sources said that only one third of the prior actions for the conclusion of the second programme review have been met.

Moreover, reports said that the institutions insist on their common view for precautionary measures after 2018 in order to safeguard the primary surpluses targets for many years after.

Regarding IMF’s participation in the Greek programme, eyes are turned to German Chancellor Angela Merkel and IMF chief Christine Lagarde crucial meeting in Berlin on Wednesday.

The government’s main aim is to achieve a political agreement on three pillars: reforms, primary surpluses and medium term plans on debt. Provided that the target of the agreement is met, the technical staff will return in Athens and a staff level agreement will be swiftly reached. The next step would be for the IMF to ask from the executive council of the fund to approve the participation in the Greek programme.

Greece has a significant asset in today’s negotiations and that is the report of the Council of the EU member states according to which the IMF has made important mistakes as far as it regards a series of economic indices and figures.