With talks between the government and troika envoys set to resume on Wednesday afternoon, Greek officials were waiting late on Tuesday for a response from the troika to their proposal for the streamlining of state defense firm EAS, the outstanding prior action which must be enforced for creditors to approve a 1-billion-euro tranche of rescue funding.
Athens has proposed that EAS be overhauled while in operation, retaining two factories for 12 months, with 350 of the firm’s 850 employees to keep their jobs and the remainder to go. It remained unclear, however, whether the troika will agree to the 500 proposed layoffs from EAS being checked off the list of 1,300 public sector dismissals Greece must enforce by the end of this year.
Apart from the fate of EAS, government and troika officials are set to discuss other thorny issues including troika calls for restrictions on home foreclosures to be lifted and the value-added tax on restaurants and other food services to return to 23 percent from 13 percent.
Development Minister Costis Hatzidakis is to discuss both issues with the troika on Wednesday afternoon while Finance Minister Yannis Stournaras is to have a separate meeting with the foreign auditors. Later this week Prime Minister Antonis Samaras is to chair a mini cabinet meeting with both ministers and Administrative Reform Minister Kyriakos Mitsotakis, who is overseeing an overhaul of the civil service, to discuss loose ends.
A controversial unified property tax is expected to be submitted in Parliament on Wednesday night or Thursday morning and voted on in the following days amid fears of defections by coalition MPs. It is likely that an amendment regarding the restrictions on foreclosures will be tagged onto the property bill.
In any case, the government’s aim is to push all outstanding legislation through Parliament by December 20 when Parliament is set to close for Christmas, Hatzidakis said on Tuesday.