So the target for the end of the surveillance program in June 2022 is off the map and so the country will remain under enhanced post-surveillance regime until the end of 2022.
Second thoughts on the country’s exit from the enhanced surveillance regime are being made to the financial staff at a time when discussions with the Commission on the end of surveillance in June 2022 were at an advanced stage while the unblocking procedures were in a row.
Developments on the energy precision front have given new impetus to government plans, and officials have wondered whether, amid an inflationary crisis threatening to raise public borrowing costs and Greek bonds falling two steps behind the investment stage. It was wise for the country to rush out of the enhanced surveillance program.
This is because even after the expiration in March 2022 of the extraordinary securities market program of the European Central Bank, the enhanced supervision maintains the special waiver for the Greek bonds, strengthening the liquidity in the economy at a crucial moment for the restart.
Thus, the target for the end of the supervision program in June 2022 is off the map and so the country will remain under enhanced post-memorandum supervision until the end of 2022 so that it can claim a delayed installment of its Greek bond profits.
In total, Athens expects three disbursements of profits from ANFA’s and SMP’s, the first of which will come with the successful completion of the 12th evaluation that will run at the next level next week, October 19 and 20, while the technical ladders have finished the audit and have delivered a first text of conclusions on the progress of the program, on the sizes and forecasts of the new budget and the effort to restart the Greek economy in the fluid scenario of the energy crisis.
A major issue in consultation with lenders will be the budget as after the packages for compensations to the fire victims and the firefighting measures to deal with energy accuracy, the cost to the state coffers is higher by 1 billion euros.
The primary deficit is already in the red zone of 7.4% of GDP without taking into account the funds for the expansion of the package with the compensatory support measures for households.
The General Accounting Office is looking for free fiscal space to stem the tide of price increases in products and consumer goods in addition to increases in electricity and gas tariffs.
The problem is not cash but fiscal, says the Minister of Finance.
In other words, “there is money” given that the cash flow reaches 40 billion. euros but the Ministry of Finance does not want to send a message to the markets that it “puts its hand” on the “cushion” that acts as a “risk premium” for investors in Greek bonds and contributes to the low cost of government borrowing.