The latest information out of negotiations in Brussels, according to Proto Thema sources, refers to a nine-month extension of the Greek bailout package worth 20 billion euros, while “haggling” is apparently continuing over creditors’ demands for pension reforms and higher tax rates.
One point, according to reports, states that the Greek side is also willing to cancel an order to upgrade five military maritime surveillance planes worth 500 million dollars. A direct contract for the latter was disclosed by Proto Thema in late April, generating a firestorm of controversy over the deal, and especially the role of controversial DM Panos Kammenos.
The latest round of negotiations between Athens’ radical leftist government and creditors (IMF, EC, ECB) took another turn on Sunday afternoon, after yet another unproductive meeting earlier in the morning.
Creditors’ representatives were reportedly unconvinced by “alternative proposals” tabled by the Greek side, especially over measures to ensure increased tax revenues.
One relief plan, to reduce serving the external debt, is the purchase of Greek bonds held by the ESM, totaling 28 billion euros, by the ECB, with the annual interest rate falling from roughly 6 percent to 1.5 percent.
Measures cited by creditors include an immediate decrease in primary pensions by 2 percent, a measure aimed at saving 500 million euros annually. A corresponding decrease in linked supplementary pensions by 4 to 5 percent will mean 300 to 350 million euros in savings per annum. The level of slashed pensions has still not be calculated, reports state.
Another point of contention is the target for primary budget surpluses, with the Greek government wanting a goal nearer to 0.75% of GDP for 2015.
Decreases in defence spending has reportedly “doomed” the surprise outlay for the 1960s-era designed P-3B “Orions” that the Greek government wanted to retrieve from deep storage to fly yet again.
Negotiations over harmonizing VAT rates and what products will be listed in the low, medium and higher rates is continuing, although it appears Athens will accept more reforms linked with the OECD’s “took kit”.
