Finance Minister Euclid Tsakalotos will visit Luxembourg on Wednesday with the Greek government sending the message that the acceptance of the proposal for an automatic mechanism that will link medium-term debt measures with growth measures can bridge the gap in the institutions.
However, as Prime Minister Alexis Tsipras said at the cabinet meeting, if a solution is not reached and the eurozone finance ministers insist on a debt proposal similar to that in May’s Eurogroup, Greece intends not to accept it and to forward the issue at the summit on June 22, where everyone will be asked to assume their responsibilities.
On the side of the institutions, there is optimism that an agreement will be reached at the Eurogroup, without, however, specifying what the final solution will be. German Finance Minister Wolfgang Schaeuble said on Tuesday: “I am convinced that we will reach an agreement on the Greek issue on Thursday. We will manage to do so on Thursday. You will see it.” He did not, however, mention whether the differences between Germany and the IMF would be bridged.
The “Greek issue” is 5th issue on the official agenda of the Eurogroup meeting, while the presence of IMF Chief Executive Christine Lagarde is not related to Greece, but to the presentation of the report for the eurozone member states, under Article 4 of the Fund.
The Eurogroup will continue the debate on the sustainability of Greece’s public debt with the view to finding a common approach among eurozone member states and the institutions (European Commission, ECB, ESM and IMF). The discussion will include the country’s medium-term budgetary targets (beyond 2018) and possible debt measures that may arise, if necessary, after the successful conclusion of the programme by mid-2018. The framework for this discussion is the agreement reached at the Eurogroup on May 24, 2016.
The ministers will also discuss the institutions’ report on the implementation of the prior actions in the framework of the second programme review.