EU leaders are mulling whether or not Greece is ready to finally ready to stand on its own feet after its third bailout programme, an €86 billion aid package (£75 billion), comes to an end in August of next year.
Mr Gramegna, Luxembourg’s finance minister, has given the clearest indication yet that the 19 eurozone finance ministers have decided that Greece has suffered enough, and thoughts will now turn to hammering out the terms of Greece’s post-exit plan and substantial debt relief.
After eight years of economic crisis fighting, Mr Gramegna said that “all lights are set on green” to close this difficult chapter of history for Greece and the Eurozone.
Greece has received €260 billion in financial aid from Eurozone countries and the IMF since 2010, however its third, and potential final bailout expires in August this year. According to the European Stability Mechanism (ESM), Greece is still sitting on approximately €332 billion of public debt, a sum equal to nearly 180 percent of economic output.
Mr Gramegna said: “The economy is growing in a satisfactory manner and the primary surplus of the Greek budget is higher than the very high threshold that has been set.”
However the finance minister confirmed that, with the next financial crisis already on its mind, the Eurozone is also hoping to agree a number of broader measures to strengthen its ability to bail out struggling states at its June summit.
On the bailout fund, known in Brussels as the European Stability Mechanism (ESM) he said: “One of the things there is consensus on is strengthening the role of the ESM although, not yet on how much to strengthen it”.
“The second thing that there might be consensus on is the Single Resolution Mechanism,” alluding to the creation of a rescue fund.
The president of the Eurogroup, Mario Centeno, revealed today that the European institutions are working on a so-called “enhanced surveillance” tool for Greece after the country exits the bailout program in August 2018.
Although it is unclear as to whether the “surveillance” would take the form of red tape or regulation on Greece’s ability to raise capital, in his letter to finance ministers Mr Centeno said that discussions were in place to “further support the Greek authorities in their continued reform efforts in the years after the programme.”
He wrote: “We took note of the intention of the Greek government not to request a successor arrangement. On the future monitoring of the economic, fiscal and financial developments,the Eurogroup took note of the so-called ‘enhanced surveillance’ tool, as proposed by the Commission.
“Discussion on the debt strategy will continue in the weeks ahead. On the basis of a successful review, the Eurogroup will decide in June on all the elements to ensure a successful exit of Greece from the program by August.”
Although “surveillance” on spending is likely to be tolerated, in February Prime Minister Alexis Tsipras, argued against another (fourth) bailout program.
He said: “I think that in June there must be a comprehensive agreement as to how we will finally exit the program and how we can manage medium-term debt relief measures.”