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FinMin Hardouvelis: Greece Might Need a Year of Limited EU/IMF Supervision

Gikas HardouvelisAt a time when most cabinet members speak about the long-awaited exit from the bailout program, Greek Finance Minister Gikas Hardouvelis spread discomfiture to the government with his statements in Reuters on Wednesday, proving the lack of communication between the Ministry and the government headquarters. According to Hardouvelis, Greece is expecting an interim period of six months to one year of limited EU/IMF supervision when it quits the memorandum at the end of the year, without the current “micro-management” by its lenders.
Facing the possibility of early elections if it loses February’s key Presidential vote, the Greek government has invested its very existence for two more years, until the next general elections, on exiting the austerity-laden bailout program a year ahead of schedule. Hardouvelis’ statements might have revealed a secret agenda, as according to him, Greece will go through a trial period of up to 12 months with a looser control by its lenders. According to Reuters, Hardouvelis revealed that the Greek government is discussing a safety net in the form of a credit line that it can access during the interim period, featuring a much lighter supervision than in the past.
“Greece will continue to have the support of the European partners. They may not be co-drivers in the car but they are safe in the back seat and there is a buffer in case something negative happens,” the Greek Minister stressed, adding that the country’s bailout plans will be tabled at today’s Eurogroup in Brussels.
That buffer will resemble the “enhanced conditions credit line” Eurozone members are eligible for from the European Stability Mechanism (ESM) but without the bailout conditions that Greeks are used to, he said, while Athens has already expressed its intention to use the 11.5 billion euros of the Hellenic Financial Stability Fund (HFSF) as a preventive support line when it finally exits the bailout program. The Greek side hopes to be evaluated on a much smaller amount of structural reforms (up to 15) during this period. By comparison, since April, Athens had been expected to comply with approximately 800 individual measures, Hardouvelis underlined.
“So the micro-management will be gone in the sense that there will be simply few items to focus on. We expect that the auditing is not going to be as official and it should not generate the problems it did during these four years,” the Greek Finance Minister concluded.

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