Greece may receive Troika aid in instalments

Saturday 06 July 2013 09.59
Athens had hoped that eurozone finance ministers would sign off on the next €8.1bn tranche of aid when they meet next week
Athens had hoped that eurozone finance ministers would sign off on the next €8.1bn tranche of aid when they meet next week

The next tranche of International aid for Greece could be split into instalments.

This may retain the prospect of a continued hand-to-mouth existence for Greece that threatens to stifle its economy.

It had hoped that eurozone finance ministers would sign off on the next €8.1bn tranche of aid when they meet next week.

Greek officials have conceded that Greece would not meet targets on reforming its public sector by an end-of-week deadline set by International lenders.

European Commissioner Olli Rehn confirmed what many officials have expressed privately amid growing frustration with Greece's slow pace of reform, namely, that the tranche could be split into several instalments.

He said that talks involving the International Monetary Fund, the European Commission and the European Central Bank, which make up the troika that supervises Greece, would "continue as long as needed".

Greece has been kept afloat by emergency loans alone since May 2010, a few months after the start of a debt crisis that sent shockwaves through the eurozone and threatened to push Greece out of the common currency.

The latest instalment is one of the last big cash injections that twice bailed-out Greece stands to receive as part of a €240bn rescue package that expires at the end of 2014.

It needs the money in part to redeem about €2.2bn of bonds in August.

But public sector layoffs, which must be implemented alongside state privatisations as a condition of receiving aid, are an incendiary issue in Greece, which is struggling through a sixth year of recession and record high unemployment.