PM confirms that Athens will request to payoff some IMF loans before maturity; reducing fiscal targets a standing goal

Sunday, 08 September 2019 21:56
UPD:09/09/2019 09:38
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Greek Prime Minister Kyriakos Mitsotakis on Sunday confirmed that his government will convey an official request for the early repayment of  a portion of loans owed to the IMF, saying the proposal will be submitted at the Eurogroup meeting on Friday.

Mitsotakis spoke at a wide-ranging press conference in Thessaloniki, a day after giving a customary state-of-the-economy address to inaugurate the annual Thessaloniki International Fair in the northern city.

The early payment of the more expensive IMF loans extended to Greece, in two successive bailouts, was originally floated by the previous government, but with the initiative frozen due to the July 7 election in the country. The savings for the Greek state, as he said, will be 75 million euros.

Speaking almost two months to the day since his center-right New Democracy (ND) party won a snap election and formed a majority government, Mitsotakis said the goal of reducing annual primary budget surplus targets is unchanged. At the same time, he appeared confident that this year's 3.5-percent primary budget surplus target - as a percentage of GDP - will be achieved, and that subsequent targets will be reduced, with the acquiescence of European creditors and partners.

Along these same lines, he dismissed a proposal by main opposition SYRIZA party, which ruled between January 2015 up until last July, to use a nearly 35-billion-euro "cash cushion" accumulated from leftover third bailout funds to trigger a reduction in the annual fiscal target.

The pro-business Mitsotakis reiterated that his government aims to reduce current VAT rates, promising over a four-year period to set most rates at either 22 and 11 percent. Moderate tax cuts for self-employed professionals and for incomes exceeding 20,000 euros will also be fulfilled, he said.

Asked about domestic political developments, he dismissed speculation - arising just two months after the last election - that he'll at some point declare a snap election, preferring instead to pass a revision of the election lawand restore a more plurality/majoritarian system, whereby the first-past-the-poll party is given a bonus of Parliament seats in order to form a government.

He again put the threshold at around 40 percent of the vote in a general election (of the valid ballots) to allow the vote-leading political party to form a majority government.

Turning to foreign issues and the simmering irregular migrant/regular crisis, Mitsotakis said he broached the need for EU decisions to be implemented, namely, for the fair distribution of recognized refugees to all Schengen Pact member-states, in his recent meetings with the French, German and Dutch leaders.

Asked about the prospect of a meeting with Turkish leader Tayyip Recep Erdogan at the end of the month at the UNGS sidelines, he said his intent is to sit down and talk with the latter, "because only then can you find mutually acceptable solutions ... If Mr. Erdogan has an interest in a substantive restart in Greek-Turkish relations, he should demonstrate this in practice."  

Finally, asked about the contentious Prespa Agreement that was engineered and ratified by the previous SYRIZA government, Mitsotakis reiterated, as he did in the opposition, that it was a "nationally damaging" pact. However, he said it has been ratified by the Greek parliament and that there is no provision for a revision.

The Prespa agreement resolved the long-standing Macedonia "name issue" between Athens and Skopje, with the provisional "former Yugoslav Republic of Macedonia" being replaced with the now internationally recognized Republic of North Macedonia.

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