ESM releases much-awaited 1-billion-euro sub-tranche

The European Stability Mechanism (ESM) on Tuesday approved the disbursement of the outstanding bailout sub-tranche of 1 billion euros to Athens.

However, this came with a clear message to the Greek government from ESM head Klaus Regling, who said that it should continue with the rapid pace of reform implementation so that the first review of the program can be completed in early 2016.

The ESM announced that the 1 billion euros will be used for the repayment of part of Greece’s debt, for projects jointly funded by the European Union and for Greek budgetary needs.

Sources say that half of the sub-tranche will go toward servicing the debt, 300 million toward covering state arrears to suppliers and taxpayers, while the remaining 200 million will be spent on jointly subsidized projects.