The 13th evaluation and the exit from enhanced supervision

A prelude to achieving the goal of finishing off the memorandum period is the 13th evaluation that culminates next Tuesday – Wednesday with the consultations of the heads of the Institutions and the Greek government. The teleconferences focus on the quarterly commitments, but the focus is on the exit path from enhanced supervision and the roadmap shows a series of moves to reach the goal by this summer.

The focus will be on fiscal developments, support measures and the prospects of the Greek economy at a critical time for the Eurozone due to the double crisis in health and energy. At the same time, the Member States have entered the phase of returning to fiscal regularity – and by committing targeted support measures. At the forefront of this assessment will be the reduction of arrears of public debt to individuals, the implementation of the new rules for bankruptcy, auctions and issues around banks, justice, health, etc.

Measures and reforms

Crucial is the ongoing assessment, which will put Greece on the table in terms of the list of measures and reforms committed in 2018. The outcome of the assessment is expected in February and the positive report is not linked to a disbursement. But it sets in motion the next, new timetable for completing the outstanding prerequisites for the country to emerge from the enhanced post-memorandum supervision by August 2022. The financial staff is focusing on positive developments, having as weapons first the better course of the economy in 2021 (by 2 billion Euros less than the target), but also the progress in reforms – commitments and the strong recovery.

One of the main goals set by the government is to exit the enhanced supervision and the information shows that the Greek side intends to request the repayment of the two installments remaining from the return of the profits of the European central banks from Greek bonds (SMPs and ANFAs. ). One of the two is being launched following the next evaluation to approve the disbursement in June at the Eurogroup. The other that is pending from 2019 may become a “package” with the last one and thus the country will receive in the summer an amount of 1.5 billion Euros. After the exit moves, Greece will enter the new period, during which first it will not be in a special control regime, while at the same time the signal will be given to markets and investors that the Greek economy has changed page. It is also another call for the much-coveted upgrades to come from the rating agencies, so that the country can regain – perhaps in 2022 – the investment grade it lost in the 2010 crisis. Greece will be evaluated. However, a relatively more relaxed monitoring will follow and the control will take place every six months (rather than every quarter).