The talks will focus on fiscal performance ahead of drafting the 2019 budget, in the light of a major policy speech by Prime Minister Alexis Tsipras in Thessaloniki in which he promised a relaxation of many of the strictures imposed during Greece’s bailouts. With an eye on approaching elections, the Syriza-led government has announced extensive economic handouts, claiming it can finance them without recourse to the pension cuts and tax hikes demanded by creditors in June in exchange for debt relief.
Domestic political uncertainty and Turkey’s financial crisis are keeping spreads on Greek bonds wider than those of other EU member states.
The government claims it has a reserve of some 20 billion euros, sufficient to cover borrowing needs for two-and-a-half years.
With investment flows sluggish, privatisation will proceed slowly and there is minimal productive investment.
