The final report on the exit from the Enhanced Supervision – The remarks

By Tasos Dasopoulos

It is now a matter of days before the Commission’s report proposes the payment of a single installment of bond profits after 14the post-memorandum evaluation and – most importantly – the expiration of the enhanced surveillance regime for Greece on 21 August.

With the approval of the report by the Eurogroup in June, the exit from the enhanced supervisory regime will be approved by the Council of Finance Ministers of the Eurozone.

At the same time, the process for the payment of one of the two installments of 650 million euros from the outstanding bond profits will begin, in order to complete the repayment of approximately 5.3 billion from the profits received by the ECB and the other central banks from the holding of Greek bonds, since 2010, which were not refinanced and did not participate in the PSI.

According to information, the report will confirm that Greece has achieved the vast majority of the obligations, which it promised to fulfill, after the end of the third memorandum. The majority, but not all. This, given that the delays of the past and the coronavirus crisis, which “froze” the public and private sector for about two years, delayed some of the country’s obligations.

Their completion will henceforth be monitored on a semi-annual basis, as is the case with other countries that have implemented rescue programs, such as Ireland, Portugal, Spain and Cyprus.

The pending issues

The issues that will continue to be monitored, with the prospect of completing everything in 2023 and will permanently close the book of the country’s obligations, are:

– The final settlement of the red loans, which should be reduced to levels according to the European average. The EU wants to see the 203 arrangements reached by the out-of-court debt settlement system multiply in the coming months, removing the burden of non-performing loans from the real economy. At the same time, he insists on seeing the substantial resumption of the electronic auctions, progress in the settlement of the 30,000 applications of the Katselis law that are still pending in the courts and the final solution for the forfeiture of public guarantees totaling 5.5 billion euros, which are still borne by: the balance sheets of the banks.

– The reduction of overdue debts of the state to its suppliers. Following the clawback reform, which reduced the balance by around € 200 million, the Commission is waiting to see the operation of the mechanism to prevent the creation and accumulation of new overdue debts to individuals.

– The zeroing of outstanding pensions. According to the Ministry of Labor, the vast majority of “overdue” by 2019 have been awarded.

– The integration of the network in primary health care and the first phase of the digitization of justice. A new timetable should be set for the creation of the TOMY network, while the system of electronic issuance and management of dossiers should be advanced and completed.

– The ratification of the forest maps which is a necessary condition for the completion of the Land Registry. The goal is to be validated by mid-2022.

The last dose

The last tranche of bond profits outstanding from 2019, is expected after the first half-yearly assessment of the economy near the end of the year, provided that the intermediate targets agreed between the Ministry of Finance and the relevant ministries with its experts have been met. European Commission.