By Tasos Dasopoulos
The way for the repayment of the IMF loans and the early payment of the double installment for the bilateral loan with the eurozone member states (GLF) was given today by the boards of the ESM and the EFSF.
The latter formal procedure has nothing to do with the approval of the early repayment by Greece, since the ESM has supported the Greek request with its proposal to the Eurogroup. It concerns the denial of the right of the organization as a preferred creditor of Greece, since the IMF is repaid early to do the same with the ESM / EFSF.
Thus, the Governing Councils of the European Stability Mechanism (ESM) and the European Financial Stability Facility (EFSF) today agreed to waive the obligation to repay ESM / EFSF loans in relation to the early repayment of the remaining foreign currency loans. Cash desk. IMF) and early loan repayment to Greek Loan (GLF) lenders.
According to the ESM and EFSF loan agreements with Greece, with the early repayment to other creditors, a proportionate amount of financial assistance provided under the ESM and EFSF facilities becomes immediately overdue and payable. Thanks to the exceptions given today by the ESM and the EFSF, Greece will not be forced to make an early repayment to either institution.
“The full early repayment of Greece’s outstanding loans by the IMF, as well as the prepayment of part of GLF’s loans, sends a positive message to the markets about Greece’s financial position. It will also have a positive impact on Greece’s public debt profile and These are welcome developments for the ESM and the EFSF, which account for about half of Greece’s public debt, and we will continue to work with Greece to support aid efforts. its long-term growth potential, which is key to maintaining debt sustainability, “said Klaus Regling, CEO of the ESM and CEO of the EFSF.
The exemptions were granted in response to official requests from the Greek government, which proposed early repayment of the remaining loans to the IMF, amounting to about 1.86 billion euros. In addition, Greece intends to prepay the capital payments originally due in 2023 to GLF lenders amounting to 2.65 billion euros. The Hellenic Loan Facility was part of the first financial support program for Greece, agreed in May 2010. It consisted of bilateral loans from 14 euro area countries, amounting to 52.9 billion euros.
Source: Capital
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