ATHENS: The Greek government has agreed Friday to institute new measures worth of 2 percent of gross domestic product by the end of the decade after the country exits its third bailout program.
However, there is no scheduled date for new payments to Athens, which raises doubts about Greece‘s ability to repay creditors in July. Furthermore, discussions on debt restructuring, which have yet to begin, are set to be complex and long.
Eurogroup President Jeroen Dijsselbloem said Friday that in talks with the Greek government after the latter agreed to legislate reforms affecting the country‘s pension system and widen the country‘s tax base. Once that review is finalized, Greece will receive fresh disbursements from the 86 billion euro ($91.40 billion) bailout program. “We don‘t know dates for disbursements,” the official said. It all depends on how quickly Greece legislates the new reform package.
Analysts have said that ($8.51 billion) it owes governments and private investors due next July without new money coming in.
“My guess is that the Greek government got a stern warning from the ECB(European Central Bank)/Bank of Greece that a further impasse would have meant a severe hit to the economy via capital outflows,” Claus Vistesen, chief euro zone economist at Pantheon Macroeconomics, told CNBC via email about Friday‘s agreement.
