Financial News: Eurogroup urges acceleration of reforms and privatisations, political consensus

The Eurogroup urged Greece to speed up structural reforms and its privatisations program, and also called for opposition parties' consensus on the Greek economic adjustment program, in statements by European monetary and economic affairs commissioner Olli Rehn and Eurogroup president Jean-Claude Juncker after a meeting of the euro area finance ministers in Brussels on Monday.
Rehn said a "very good discussion" took place on the extension of the repayment period for Greece's 110 billion euros EU-IMF bailout loan to Greece.

Noting that Greece had achieved in 2010 an unprecedented reduction of its fiscal deficit, he said that an assessment report by the 'troika' (European Commission, European Central Bank and International Monetary Fund) on the implementation of the Memorandum in Greece was awaited, adding that some gaps have been ascertained in the assessment so far both with achievement of the fiscal targets and the privatisations program.

Juncker, in turn, said he was satisfied with Greece's clear-cut commitments on the implementation of new extraordinary measures to attain the fiscal targets for 2011. "If Greece succeeds in meeting the fiscal targets for 2011, if it speeds up the privatisations program and if there is political consensus, things may not be easy, but they will be feasible," he said.

The two officials called for political consensus regarding the implementation of the Memorandum in Greece, saying it was a sine qua non for the smooth continuation of financing to Greece.

"It is a national, and not a party, issue," Juncker said, adding that the markets, the governments of the eurozone countries, the national parliaments and public opinion expect Greece to function as a team in a responsible manner, was the case in Ireland and Portugal.

On a Greek debt restructuring, Juncker said that a broad restructuring is not a solution, but did not rule out the prospect of some form of debt "reprofiling" enabling Greece to repay its debt at a later stage was an option, but under conditions. First, Greece must implement the measures needed for fiscal adjustment, and then any decision will be taken, most likely at the Eurogroup meeting in Luxembourg in June.

On the prospect of creation of an agency to handle the exploitation of Greece's state property, Juncker said it is an option that is also being examined, but was not backed by everyone.

Greek finance ministry sources said later that deliberations with the eurozone partners will continue until June, when the Ecofin ministers will meet to take their decisions regarding Greece.

As for the ongoing inspections of the 'troika' representatives in Athens and their talks with the Greek government, the sources anticipated that these will not be completed by Wednesday, as initially scheduled, and may continue into next week.

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