Suzanne Lynch, European Correspondent
Negotiations between Greece and its international creditors will resume in Brussels and Athens on Monday in a bid to hammer out a provisional bailout agreement ahead of a key euro group meeting on April 24th.
European stock markets continued to strengthen yesterday on the back of Thursday's news that Greece had repaid a €460 million debt repayment owed to the IMF, despite continuing concerns about Greece's ability to meet its debts over the coming weeks. With Greece facing a critical fortnight in its continuing standoff with international lenders, discussions between representatives of the Greek government and officials from the ECB, European Commission and IMF have been in train in Athens and Brussels.
According to officials, the aim is to agree on a re-calibrated reform plan by the middle of next week, with the aim of securing political sign-off for a deal at the next euro group meeting scheduled for less than two weeks’ time in the Latvian capital, Riga. Among the sticking-points between the two sides are further pension and labour market reforms, though Greek finance minister Yaris Varoufakis’ announcement on Thursday that the government will re-start the halted privatisation programme, was seen as a welcome development by lenders.
Meanwhile, the European Central Bank is understood to have further raised the ceiling on the amount of emergency lending assistance it can provide to the Greek banking system, while discussions between Greece and the three creditor institutions continue. More than €72 billion has now been provided by the euro zone's central bank to Greek banks, which have suffered an outflow of deposits since the unravelling of its bailout programme in late January following the collapse of the centre-right government of Antonis Samaras.
Reports emanating from Finland earlier this week suggested that the euro group was considering the possibility of a Greek exit from the euro area. Citing a memorandum from the Finnish finance ministry, the reports set out a scenario whereby a "process is started which results in Greece being expelled from the euro" should the country fail to meet its bailout obligations.
While Greece met its €460 million IMF payment this week, another €747 million is due to be paid to the Washington-based body on May 12th. In the meantime, Athens must continue to meet its regular exchequer bills, including public sector salaries and pensions in the coming weeks.
The government of Alexis Tsipras was elected on an anti-austerity agenda ten weeks’ ago but has since failed to secure any significant recasting of its bailout terms, though discussions have continued with creditors in a bid to unlock cash due to Greece under the terms of its second bailout.
