The first assessment of Greece outside enhanced supervision is coming

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By Tasos Dasopoulos

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With the procedures for the – now standard – exit of Greece from the enhanced supervision regime having been launched, the financial staff is also preparing for the first evaluation in the new supervision regime, that of the European semester, which acquires special characteristics due to the circumstances.

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The exit from the regime of enhanced supervision will be ratified by the decision of the European Commission not to extend the regime of enhanced supervision for another six months, as has been the case on a six-monthly basis since the summer of 2018, when this special regime was also decided for Greece . The financial staff has already received the letter co-signed by the Vice-President of the Commission, Mr. Valdis Dombrovskis, and the Commissioner for Economic Affairs, Mr. Paolo Gentiloni, in which they confirm that they do not intend to continue the regime of enhanced supervision for Greece. As is well known, the exit of Greece from the regime of enhanced supervision was also ratified by the June Eurogroup, with the representatives of the institutions and the Ministry of Finance congratulating the Greek authorities for the progress they had in the commitments they had undertaken even in the months of the pandemic . In any case after 12 + 1 successful evaluations the exit from the enhanced supervision from the 20th of the month is more formal than essential.

The last evaluation

In its most essential part, the exit from enhanced supervision should be accompanied by a final evaluation. This “examination” will take place in the new for Greece regime of the European Semester. The success of this assessment will also return to Greece the last of the installments of 650 million euros from the profits of the bonds that the ECB and other central banks retain until the end of the year. With this latest tranche, Greece will have received the total of 5.2 billion euros, from profits that the ECB and other central banks had from Greek bonds that were bought and not refinanced, nor did they participate in the haircut of the Greek bonds, the known PSI. This money was to be returned during the 2nd memorandum, but it ended… ingloriously in the summer of 2015. The institutions came back after the 3rd memorandum was completed and incorporated this money into the medium-term debt relief measures. And their payment was decided to be made in six-monthly installments, the disbursement of which would be linked to the implementation of Greece’s commitments.

During the upcoming evaluation, the Greek side will have to analyze its plans to the institutions until the end of 2022, but also for the whole of 2023. So far, a new brave support package against precision has already been announced, valid until the middle of next year, which will be analyzed by the Prime Minister from Thessaloniki, in the context of the TIF. This package, according to information, concerns the largest support for households in electricity tariffs, a new fuel subsidy (the fuel pass 3), but also a new significant support for the approximately 2 million economically vulnerable citizens who received in April the “accuracy check” of 200 euros. Also, the permanent interventions that Greece wants to make in 2023 in salaries and pensions will be analyzed and combined with the available fiscal space.

The “tails” of enhanced supervision

At the same time, of course, the progress of the main issues on which the institutions give importance, the completion of which was delayed due to the pandemic, should also be examined. The main topics are:

– The overdue debts of the State. The European Commission expects at this stage the final settlement of overdue and non-awarded pensions until August and the payment of pensions and retroactives. In the clawback institution, the committee expects to start the process to collect the remaining 30% of the total clawback (from pharmaceutical and diagnostic centers) for 2021 through installments to be agreed with the debtors by the end of July. Also, at least 35% of the 2022 clawback must be collected by October.

– The NED liquidation. In the effort to definitively liquidate the non-performing loans there are two plus one main outstandings:

1) The liquidation of the 30,000 pending insolvency cases of the old Katseli law should proceed effectively. 95% of cases with rescheduled hearing dates should have a hearing date by the end of October. The remaining 5% will have a hearing date no later than the end of 2022. We should also have a final court decision on 25% of the cases set by the end of October.

2) In the new bankruptcy law, until the end of September there should be a consultation with the private parties concerned about the new real estate management body where the real estate of households that declare “personal bankruptcy” will be transferred.

Also, until September 2022, the forfeitures of State guarantees for loans amounting to 470 million euros to individuals will have to be examined.

The rest of the reforms

In primary health care, by the end of June 2023, the derivative law for the system of electronic registrations and appointments, as well as the registration of patients in the family doctor’s system, must be approved. The aim is to reach 25% of the total population registered in the system by the end of October and 50% by the end of 2022. Also, by the end of July 2023 self-employed family doctors will be registered in the system and should reach a level that will allow coverage of at least 85% of the population.

In justice, the improved functionality of the electronic platform for issuing and managing documents should be ensured and put into pilot operation by the end of June 2023. The implementation of the measure will now be considered.

The approval of the forest maps in their final form is also a critical pending matter, so that the completion of the cadastral register, which is considered one of the key reforms, will be delayed due to the coronavirus pandemic.

Finally, pending for the autumn there is also the codification of the labor legislation which, of course, is also the responsibility of the Ministry of Labour.

Source: Capital

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