By N. Bellos
Eurozone officials remain cautiously optimistic that an agreement to unblock short-term debt relief measures for Greece can be reached before the new year, although written assurances requested from the leftist Greek government that an extraordinary spending measure won’t be repeated in the future, had still not been conveyed to the Eurogroup by Thursday evening.
The contentious measure involves this month’s “holiday bonus” for more than half of the country’s pensioners.
Essentially the last working day before the Christmas and New Year’s holidays is Friday, as EU and Eurozone institutions will remain closed until Jan. 3, 2017.
The institutions, nevertheless, accepted a request by Athens and on Thursday sent the Greek government written questions over the “holiday bonus” allocated by the latter this month. The Tsipras government had first signaled that it would provide written assurances that the one-off spending bonus would not be repeated without prior consultation with the creditors. During the week, however, the mood hardened in Athens, with the Greek side requesting specific questions instead of fulfilling a “carte blanche” demand.
If Athens’ written assurances aren’t conveyed on Friday, then whatever new developments will have to wait until Tuesday, after Christmas.
Besides persuading European creditors that the “holiday bonus” was an extraordinary spending measure aimed at supporting a specific socio-economic group, Athens must also present the legislation showing that a suspension of a VAT rate harmonization measure for various Greek islands is also a temporary measure, something that is not expected to be disputed, given that recently ratified legislated clearly stipulates that the measure is in place for one year only.
What creditors want, however, is to know how Greece’s leftist-rightist coalition will cover whatever fiscal gaps arise in the 2016 budget from the spending measures. Additionally, creditors want confirmation that whatever primary budget surpluses in the future will be disbursed as previously agreed to, i.e. 30 percent to ameliorate the debt; 30 percent to cover the Greek state’s arrears (especially to the private sector) and 40 percent for weaker socio-economic groups through the minimum guaranteed income framework.
