Eurogroup President Jeroen Dijsselbloem expressed optimism that Greece will fulfill the prior actions required by Monday in order to receive the 2-billion-euro subtranche and an additional 10 billion euros for the recapitalization of Greek banks.
With some measures still pending, the Greek government is rushing to close all issues with the main one being the protection of primary residencies from foreclosure of non performing mortgages. Other issues still pending are the 100-installment plan for debts to the state, pricing of generic medicine and value added tax on private education.
Dijsselbloem on Tuesday appeared before the European Parliament’s Economic and Monetary Affairs Committee and said he was hopeful that a balance can be found between protecting vulnerable households and strengthening the legal framework, so that it is not abused by people who have the means to pay but take advantage of the law protecting debtors.
The European Commission and Eurogroup both agree that households that are unable to meet their loan payments must be supported. Dijsselbloem added that the institutions are expecting the Greek government to soon submit proposals, so that an agreement is reached by Monday.
Regarding the recapitalization process of Greek banks, the Eurogroup head argued that it was a positive development that fewer funds will be necessary than initially estimated. Greek banks need 14.4 billion euros and the European Stability Mechanism has already earmarked 10 billion euros for that purpose. The rest will be likely covered by private investors.
Dijsselbloem said that should an agreement be reached early next week, the process of Greek banks getting the 10 billion euros will conclude in a few weeks. However, the issue of bad loans should be resolved first because it is inextricably connected to the financial sector.
Meanwhile, Greek Prime Minister Alexis Tsipras will ask for political aid regarding the pending issues on the sidelines of the Malta summit on Wednesday, when European Union state leaders will meet to discuss the refugee issue.
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