The pressure on the Greek government to carry out immediate structural changes in the economy and introduce new measures is increasing, in order to restore some financing to the country and – possibly – release some of the aid that Greece was to collect last August from the EU and IMF.
Monday’s Eurogroup will therefore be decisive, as the Minister of Finances Yanis Varoufakis will have to present specific measures to his colleagues on settling tax debts, combating tax evasion, “red loans” and the cost of the initiatives to tackle the humanitarian crisis.
On Thursday, the president of the European Central Bank referred Greece to Monday’s Eurogroup for financing. The marginal ELA increase and exclusion from the quantitative easing program, but more importantly rejecting the request for an increase of the Treasury bill issuance was a clear message to the Eurogroup, according to the Greek government.
Greek government officials note that Mr. Draghi’s comment that the ECB is not a political institution, but is rather based on rules that disallow direct or indirect financing supports the Greek position that a political solution is necessary in the midterm, until a final solution for the Greek debt problem can be reached.
Furthermore, government officials opined that Draghi’s decision did not cause any additional problems to the Greek banking system and that they are working hard towards implementing the decisions taken at the Eurogroup on the 20th of February. Many top government officers have stressed that the country’s funding needs are covered at least until March and that Greece will argue that the economy must be financed until June.
Meanwhile, Brussels and Athens have disputed media reports that Mr. Varoufakis’ list of reforms was discussed at yesterday’s Euroworking Group. An officer in Brussels further explained that what were discussed were the progress of the existing bailout program and the completion of the fifth review. The Euroworking Group is set to convene on Monday before the Eurogroup.
