Bloomberg reports that a series of commitments and assurances were provided by the Greek government to convince creditors to resume the final stages of the second evaluation of the third bailout programme. The assurances given concern the completion of the remaining prior actions before the next Eurogroup meeting in February.
The text presented by the Greek side reportedly also includes a commitment for a 3-percent annual primary budget surplus, as a percentage of GDP for five years after 2018; dropping to 2.5 percent for another five years, but with the specific target fixed at 2.3 percent until 2029.
The current Greek bailout programme is due to expire in 2018 when Greece is expected to return to the money markets for its lending needs (paying back the loans). Primary surplus targets outside the programme will not be enforceable by the lenders in the same way as they are now, as they will not be able to monitor and impose demands on Greece as they do now, by threatening to withhold funds.
Greece after 2018 should only be subjected to the same and much more lenient rules of the ‘fiscal compact’ that other countries in the eurozone seem to ignore without any penalties being imposed. France, Italy, Spain and Portugal have all exceeded their EU set targets with a mere slap on the wrist and a further extension of deadlines in order to comply with their fiscal targets and bring their budgets back on track with targets.
Unless of course another bailout ‘rescue’ plan is on the cards that will keep Greece in perpetual debt servitude and the term of supervision by the lenders is much longer than we thought
