Brussels: As Greek efforts to conclude a year-old review of its rescue programme stall, the government’s ability to regain access to the public debt market grows slimmer, increasing the possibility Athens will have to seek another unpopular strings-attached bailout programme.
Euro-area finance ministers met in Brussels yesterday to once again tell Greece it needs to do more to get a new aid disbursement. “A definitive accord is not to be expected today,” German Finance Ministry spokesman Juerg Weissgerber told reporters in Berlin before the gathering. “We all hope” that delegates of the creditor institutions “will be able to return relatively quickly to Greece” to continue assessment of whether the country is meeting bailout terms, he said.
Greece’s bailout auditors -- the European Commission, the European Central Bank, the European Stability Mechanism and the IMF -- are racing to complete the review before the start of a busy national election season in which surging populist parties would make protracted negotiations politically difficult. Greece needs to stabilize its economy by the time its €86bn ($91bn) rescue program expires next year so that it can begin financing its own obligations.
“Delays in completing the review raise the risk of another bailout being needed,” said Nick Kounis, head of macro research at ABN Amro Bank NV.
The yield on Greece’s 2-year note rose above 10 percent yesterday, before dropping 23 basis points to 9.71 percent at 2:10pm local time in Athens. Greek 10-year notes yielded 7.76 percent, almost twice the level of Portugal’s benchmark securities.
