Minister Scicluna welcomes Eurogroup agreement on Greece

Minister for Finance, Prof. Edward Scicluna, expressed his satisfaction at how Friday night’s agreement on Greece managed to bring all the relevant parties on board.

“Eagerness to reach a solution was not enough. We had to ensure that everybody was on board, including the International Monetary Fund (IMF), so that together we agree on the way forward. That will ensure the sustainability of this whole package,” said Prof. Scicluna.

PRESS RELEASE ISSUED BY THE MINISTRY FOR FINANCE

The Eurogroup meeting, which took place Friday 14th August 2015 in Brussels, was attended by the Eurozone’s Finance Ministers, and followed up the approval of an ambitious package of reforms by the Greek Parliament early on Friday, as part of a new €85 billion bailout deal.

During the meeting Minister Scicluna also stated that “a programme of this nature needs a determined government to implement and that conditionality, as well as harmonisation, between the European Stability Mechanism (ESM) and the International Monetary Fund (IMF) was needed.”

{E9327129-9165-49F1-9FA6-1FE57F1662DE} — From left to right with, Mr Rimantas SADZIUS, Lithuanian Minister for Finance; Mr Johan VAN OVERTVELDT, Belgian Federal Minister for Finance; Mr Pierre GRAMEGNA, Luxembourg Minister of Finance.

The first tranche of funds to be given to Greece under the ESM programme of EUR 26bn will consist of two sub-tranches. The first sub-tranche of EUR 10 bn will be made available immediately in a segregated account at the ESM for bank recapitalisation and resolution purposes. The second sub-tranche of EUR 16 bn will be disbursed to Greece in several instalments, starting with a first disbursement of EUR 13 bn by 20 August, followed by one or more disbursements in the autumn subject to the implementation of key milestones. A second tranche for banking recapitalisation and resolution needs of up to EUR 15 bn can be made available after the first review and no later than 15 November, subject to the completion of the planned Asset Quality Review and Stress Test and the implementation of the financial sector deliverables of the review.

An assessment conducted by the Commission in liaison with the European Central Bank has concluded that Greek debt sustainability can be achieved through a far-reaching and credible reform programme and additional debt related measures without nominal haircuts.

In a statement issued at the end of Friday’s meeting, the Eurogroup said that in line with the Euro summit statement of 12 July, it stands ready to consider, if necessary, possible additional measures (possible longer grace and repayment periods) aiming at ensuring that Greece’s gross financing needs remain at a sustainable level. These measures will be conditional upon full implementation of the measures agreed in the European Stability Mechanism programme and will be considered after the first positive completion of a programme review.
Minister Scicluna said he was satisfied that the Eurogroup was in agreement that nominal haircuts on official debt would not be undertaken.

In Brussels the Minister was accompanied by the Ministry for Finance’s Permanent Secretary, Mr Alfred Camilleri.

Saturday 15th August 2015