Greece is off Eurogroup agenda

The next government in Greece will be the one to offer the necessary explanations to the Eurogroup about the outgoing administration’s handouts, which appear to be leading the country toward a fiscal derailment and target shortfalls.

A senior eurozone official said it is “highly unlikely” that the Greek issues will be discussed at Thursday’s Eurogroup meeting in Luxembourg. Therefore any discussions will be put off until the Euro Working Group scheduled for early July.

Of course there is always a chance one of the eurozone finance ministers might raise the issue of the government handouts with his outgoing counterpart from Greece, Euclid Tsakalotos, who will be present at the meeting.

“It is possible the enhanced surveillance report will be discussed at the July Eurogroup,” the same source added, although he said even that date may be difficult as it will be just after the Greek general election and a new government may not have been formed by that time.

In that case the discussion would proceed without a Greek representative who could talk about such matters. Consequently, the first political discussion should be expected in September’s Eurogroup in Helsinki.

The surveillance report and statements by various eurozone officials show that there is no clear figure regarding the fiscal gap expected for this year, or how far behind the target for a 3.5 percent primary surplus Greece will be in 2019. Officials stress that the shortfall will depend on a series of factors such as tourism and the strengthening of growth in the coming months.

It appears that the intention of the outgoing government to repay the International Monetary Fund for expensive loans earlier has been abandoned. A senior European official says Greece has not submitted a formal request to that effect to the European Stability Mechanism as it was supposed to, although it had expressed that intention over two months ago.

This is probably because it realized it would be rejected after Athens’ recent actions. “To be honest, this is no time for such talk,” the official said.