ATHENS: The eurozone can help Greece repay maturing debt in the coming months with money that remains available to Athens under the current bailout if the programme is extended by five months to November, a note prepared for eurozone finance ministers said.
The financing note, seen by Reuters, put the total available amount for Greece at 16.3 billion euros ($18.3 billion), composed of 10.9 billion euros now earmarked for Greek bank recapitalisation, the 1.8 billion remaining tranche from the eurozone bailout fund and 3.6 billion euros from profits made by the European Central Bank in 2014 and 2015 on purchased Greek bonds.
The Greek bailout expires on Tuesday and the money still available would disappear if there is no request for an extension from Athens. “A five months extension (until end of November 2015) of the current programme is feasible during which a total of 12 billion euros of financial support would be provided by the EFSF and the transfer of SMP/ANFA related profits, complemented by an assumed disbursement of the IMF of 3.5 billion euros,” the note said.
“Over that period these external resources, complemented by the Greek primary surplus would allow to cover the amortisation and service of debt for a total of 14.3 billion euros and could cater for both arrears clearance and the reconstitution of some state buffers,” the note said. The money, however, could be disbursed in four tranches, each depending on the completion of various conditions and reforms by Athens.
The first tranche could be 1.8 billion euros of profits made by the ECB on Greek bond purchases and it would be sent straight to a segregated account used only for debt servicing, which would allow Athens to avoid a default on a 1.6 billion euro payment to the IMF on June 30.