Greek central banker: End to uncertainty imperative

Mr. Stournaras sounds alarm during conference on economy and growth at Greek parliament event

The governor of the Bank of Greece (BoG) Yiannis Stournaras warned of the risk of the state’s finances derailing and failing growth targets in 2017, if the second review of the Greek bailout program was delayed any further. Speaking at an a conference for the Economy, Growth and Reforms, organised by the office of the Greek parliament, the Greek central banker said the uncertainty caused by the delay of the conclusion of the second review had affected bank liquidity in Greece. “In order for a positive outlook on the Greek economy to return from 2017 onwards, the immediate conclusion of the second review, which has stalled for over a year, is imperative”, said Mr. Stournaras. He underlined that the delay created uncertainty which had started to have a negative impact on all the economic indices, adding that once the second review had closed measures concerning privatisations, non-performing loans, the high public debt and a realistic readjustment of the targets would have to addressed. According to estimates by the BoG, the sustainability of the public debt is compatible with a reduction of fiscal target after 2020 to a 2% GDP primary surplus, if it was combined with moderate measures for alleviating the debt, like the extension of the average weighted interest payment terms.