By Christos T. Panagopoulos
With Jörg Asmussen’s special visit in Athens, Berlin outlined on Wednesday the new bailout program, which will be imposed on Greece, in an attempt to cover the financial gap and to ease the debt, allowing creditors to continue for the next years in supervising the country’s economy, using further support as a lever by 2014, when the overall amount of the EU loan will have been spent.
According to financial experts, the new program will be based exclusively on European funds, as the International Monetary Fund (IMF) has already cleared that there will be no further funding from its side to support the Greek economy. On the other hand, Asmussen is considered, as the same sources mentioned, as “Merkel’s man of trust” inside the European Central Bank (ECB). His visit in Athens signals the commencement of a new discussion, which was previously considered as a taboo in the EU: further support to Greece with a new bailout program which will be activated in 2014.
In specific, the new program includes:
* Reduction in interest rates on existing loans and extending repayment of bonds, in order to improve the image of debt.
* Utilization of resources from EU structural funds. In this context, an increased community participation in the NSRF projects at 95% will be discussed. Greece is already making use of this particular measure at the moment, which, as consequence, leads to reduction in the amount of money, which the budget must contribute to new investments. Expansion of this measure until 2020 will significantly reduce budget expenditures in the next years.
* Funds which will come as surplus from the package of the Greek banks recapitalization will be considered as a money tank reserve. The completion of the stress test is expected to clarify how many of the total 50 billion euros will be needed, although some experts estimate it is possible this amount to exceed 10 billion euros.
* There is also a probability for a new small loan of 5-7 billion euros from the EFSF.
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Special meeting between Samaras and ECB official J. Asmussen – Wednesday, 21 August 2013