Samaras ‘fully comfortable’ seeking early exit for Greece

Samaras ‘fully comfortable’ seeking early exit for Greece

Prime Minister Antonis Samaras said he aims to sever the international lifeline that has kept Greece afloat since 2010 by forgoing disbursements of emergency loans scheduled over the next two years.

“We feel fully comfortable” that Greece can cover its financing needs from the bond markets in the coming years, Samaras, 63, said in an interview on Wednesday in Milan after a European Union summit.

A rally in Greek bonds fizzled in recent weeks as Europe’s most-indebted state became increasingly vocal in its vows to exit the 240 billion-euro ($305 billion) rescue program early. The benchmark 10-year note lost 10.7 percent over the last month, making it the worst performing note out of 34 sovereign securities tracked by Bloomberg.

The euro area and the International Monetary Fund, which fund Greece’s aid program, insist the country should retain access to bailout funds next year. The prevailing view among European and IMF officials is that Greece’s market access remains fragile, according to two people directly involved in the negotiations.

European Central Bank President Mario Draghi weighed into the debate last week, saying the country needs to remain in some kind of program for Greek banks’ junk-rated asset-backed securities to be eligible for the ECB’s ABS purchase program.

The bailout loans came with belt-tightening conditions that exacerbated a six-year Greek recession, left more than a quarter of the workforce jobless and triggered a social backlash. Aid next year would also come with strings attached.

SYRIZA Lead

Samaras, head of the New Democracy party that has governed in a coalition with the Socialist PASOK since mid-2012, is seeking to avoid early elections that polls indicate would be won by the main opposition SYRIZA party, which has made political capital from opposing the conditions of the rescue program. Greece’s next general election is due in 2016.

Ending aid payouts wouldn’t mean “a divorce” with Greece’s public creditors, Samaras, a Harvard-educated economist, said in the Milan interview.

“We want to do it properly,” he said. Greece is prepared to negotiate an appropriate oversight role of its economy for the euro area and IMF, he added.

Greece returned to bond markets in April after a four-year exile and a draft budget submitted to parliament this week foresees sales of 7-year and 10-year notes in the coming months. The government also targets an almost-balanced budget next year, when the IMF projects that the Greek economy will grow faster than most developed nations.

Progress in improving public finances and low interest rates have emboldened Samaras, who said the Greek parliament will discuss the end of international aid in a confidence-vote debate scheduled to run through Friday.

Asked how confident he is that Greece can survive without support, Samaras said: “absolutely.” 

Πηγή: Ekathimerini.com

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