Greece & creditors 'close to quite a good solution' on debt
20.05.2016 20:00 Greece SigmaLive
Finance Minister Euclid Tsakalotos was upbeat about the prospects of finding a solution with regard to Greece's debt on Friday, while addressing the Parliamentary committees processing the draft omnibus bill to be voted on this Sunday. The omnibus bill legislates for all 17 prior actions and "contingency" spending cuts mechanism needed to conclude the first review of the Greek programme.
"We are close to quite a good solution. It is very significant that everyone now understands that Greece needs to emerge from the vicious cycle of recessionary measures that lead to more recession and new adjustment measures," he said.
The finance minister said that the road map made in the summer after the signature of the agreement had envisioned the recapitalisation of Greek banks followed by a conclusion of the first review - in which he admitted there had been some delays - and then an agreement on the debt.
"We are now seeing a parallel discussion on the review and the debt," he pointed out.
Talking about the automatic mechanism for spending cuts, Tsakalotos said the idea of "contingency" measures had been around since 2012 but was only now taking on definite shape, with a first definition of what this actually meant. The minister also emphasised the "symmetry" that the International Monetary Fund (IMF) was now seeing for the first time between an automatic fiscal correction mechanism and an automatic debt mechanism, noting that this "greatly changes the landscape and gives us more time to negotiate.
"What matters is not the technical solution but the result. It must be accepted that Greece has turned a new leaf and that there must be a clean, political, economic and investment corridor so that investors can invest without the additional risk of default," he said.
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