Greece has fallen three weeks behind schedule on the prior actions schedule as Sunday’s Euro Working Group teleconference failed to result in an agreement with creditors.
Monday’s afternoon meeting of Eurozone finance ministers will be almost entirely dedicated to Greece. However, Athens has failed to resolve several issues rendering the disbursement of the 2-billion-euro bailout subtranche impossible at the moment.
The issues remaining open include primary residence foreclosures, the 100 installments for debtors to the state, value added tax on private education, and pricing of generic medicine. The Greek government is trying to reach a “fair compromise” as Prime Minister Alexis Tsipras has said.
Failure to implement the required measures and reforms delays further the first review of the bailout program. A positive review by lenders will not only unlock the 2 billion euros tranche but also give the green light for Greek bank recapitalization.
Greek Finance Minister Euclid Tsakalotos is in Brussels for the Eurogroup meeting almost empty handed. It is unlikely that something positive will come out of it, with the most negative consequence for Greece being the delay of bank recapitalization.
The Greek prime minister is pushing for a political solution, despite warnings for the European side saying that it is better that Greece will not start stalling again. Nevertheless, Tsipras had telephone conversations with European Commission President Jean-Claude Juncker, German Chancellor Angela Merkel and French President Francois Hollande asking for easing of some of the bailout terms.
Meanwhile, the representatives of the four lenders — the European Commission, European Central Bank, European Stability Mechanism and International Monetary Fund — are expected to return to Athens on Wednesday for the first review of the progress of implementing the reforms required by the bailout program.
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