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Financial News: FinMin optimistic over extension of loan repayment, eurobond issue

Δημοσίευση 19 Ιανουαρίου 2011, 11:31 / Ανανεώθηκε 27 Ιουνίου 2013, 14:55
Financial News: FinMin optimistic over extension  of loan repayment, eurobond issue
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Finance Minister George Papaconstantinou on Tuesday said he was cautiously optimistic on the prospect of reaching an agreement in the near future over a permanent financial support mechanism to deal with crises, while underlining the need for Greece to strictly adhere to a public finances restructuring programme and necessary structural reforms.

Finance Minister George Papaconstantinou on Tuesday said he was cautiously optimistic on the prospect of reaching an agreement in the near future over a permanent financial support mechanism to deal with crises, while underlining the need for Greece to strictly adhere to a public finances restructuring programme and necessary structural reforms.

Speaking to reporters, after an ECOFIN meeting here, Papaconstantinou said the meeting focused on the figures of a package to be agreed on by EU governments and which will ensure not only fiscal stability but the ability of pre-emptive interventions in times of economic crises.

“The discussion is progressing so that a decision can be reached in one of the next European Councils,” the Greek minister said, adding that the right decisions would be taken to fortify the Eurozone.

Commenting on Greece, Papaconstantinou said both the European Commission and the European Central Bank expressed positive opinions over the way the Greek government is implementing a fiscal consolidation programme, acknowledging that reducing the fiscal deficit by 6.0 pct in 2010 was the result of an extremely serious effort.

He noted that creating a medium-term framework of economic policy in Greece was needed, particularly for the period 2012-2014 and stressed that the government wanted all political forces to contribute in the creation of this framework, along with representatives of social partners.

The minister noted that a Eurogroup meeting on Monday reaffirmed the political will to extend the repayment period of Greece’s bailout loans from the EU Commission and ECB, saying that the issue would be part of a package to be agreed for a support mechanism. He declined to predict whether the country anticipated a lowering of its borrowing costs and said this issue would be also part of a total package for the EU.

“The Greek government was fully reassured that any decision regarding the support mechanism would cover Greece as well,” Papaconstantinou told reporters.

Moreover, he expressed his satisfaction over the success of recent auctions of Treasury bills by Greece and stressed that despite recent worries, Greek bond spreads remained stable around November levels. He added that Athens was looking forward to an extension of paying for its loans, a decision which could help markets understand that Greek public finances are sustainable.

Finally, he noted that the issue of a Eurobond would be also included in a larger package, currently under negotiation and underlined his confidence that domestic banks would successfully pass the next series of stress tests.