At the beginning of 2022 the early repayment of IMF – GLF

By Tasos Dasopoulos

At the beginning of 2022, the repayment of the balance from the loans of the International Monetary Fund to Greece, amounting to 1.8 billion euros, will proceed, as well as the first repayment of 5.3 billion euros from the bilateral loan of a total of 52.3 billion euros that Greece received during the first memorandum.

At today’s meeting of the Eurogroup, the finance ministers of the Eurozone were informed that Greece is considering the possibility of early repayment of the remaining amount of its loan with the IMF, as well as the partial prepayment of bilateral loans related to 2022 and 2023 payments.

“The council welcomed Greece ‘s intention, considering that it would have a positive impact on the country’ s finances,” the Eurogroup said in a joint statement. According to information, during the meeting, the head of the European Stability Mechanism (ESM) Klaus Regling pledged to complete his presentation to the council early next year, with which the Organization will recommend the early repayment by Greece as a whole. 7.2 billion euros to repay the debt.

The delay, according to official sources, was necessary since the German government will have to be convened as a body, which will have to approve the Greek request at the Eurogroup level, by the finance minister of the new government, but also at the parliamentary level.

The Eurogroup statement on Greece’s progress regarding the commitments of the 12th enhanced surveillance report states that after a rapid contraction in economic activity in 2020, the Commission’s autumn forecasts show a significant economic recovery in Greece this year, 2022 and 2023. “The timely, targeted and temporary support measures taken by the Greek authorities have reduced the impact of the pandemic on businesses and workers. The authorities’ efforts have been supported by new EU instruments, such as the Recovery Fund and SURE.” “Implementation of the reforms and investments of the Greece Recovery and Sustainability Plan are expected to give a substantial impetus to growth and to form the basis for consolidating efforts towards a green and digital transition.”

The Eurogroup also states that “we welcome the further reforms that have been achieved in difficult conditions due to the pandemic and the catastrophic fires of August 2021”.

Special reference is made to the new accounting plan, to the interventions in the energy sector, “which fulfill the commitments that have been made”. There has also been “good progress” in simplifying investment licensing, privatization and the governance of state-owned enterprises, but also in the areas of social welfare and public administration.

“The uncertainty surrounding the pandemic is still present and underscores the need to continue to tackle the existing medium-term risks and challenges identified in the 12th Enhanced Surveillance Report.” That is why “we encourage the Greek authorities to continue and advance their efforts regarding the reform of the financial sector and the settlement of overdue debts”. They also noted “some delays in the areas of justice and health and called on the authorities to speed up progress in fulfilling their commitments in these areas”, stating that these issues would continue to be monitored under enhanced surveillance.