Greece and its creditors to create a cash reserve fund

The Greek economy has begun to converge with the European one, both in terms of dynamic growth and in terms of social stability. However, economy ministry sources said that for the smooth transition to financing through the markets, Greece and the creditors aim to create a cash reserve fund as there are external counterbalancing forces that could reverse the positive climate and momentum of the global economy and create new problems beyond the geopolitical crisis with Turkey and the refugee issue.

The same sources said to the Athens-Macedonian News Agency (ANA) that the easing of political uncertainty, the economic and social stabilisation and improved growth prospects are reflected in both the recent normalisation of the Greek government bond yield curve and the upgrading of the economy by the three international credit rating agencies, as well as the recent positive comments of the president of the European Commission Jean-Claude Juncker and the head of the OECD Angel Gurria.

The same sources said that Greece has already successfully tapped the market three times, strengthening the market expectations, while it also issued seven-year bonds in February that attracted strong investment interest despite the turbulence in global markets.

“Aiming at smoothly moving to financing through markets, Greece and its creditors have been planning to create a cash reserve fund – estimated at about 10.2 billion euros – through the next disbursements under the Financial Support Programme. From the successive exits to markets, it is estimated that another 7-8 billion euros will be earmarked to form an 18-billion-euro pillow to cover the needs of the country for about 1.5 years if needed.”