Greece Reforms Approved by Eurozone
The list of reform Greece submitted in the process of receiving a loan extension has been approved by the finance ministers in the Eurozone meeting that ended later on Tuesday. This means that the Athens are going to receive the full backing of the Euro group as four more months has been given for the implementation of their financial rescue plan.
Some national processes, like voting processes will be undertaken in many states in order to finalize the four months extension negotiation – this was stated by the Eurozone.
Although the Grecian reformation agenda contained measures to fight corruptive practices like evasion of tax and smuggling with further public sector enhancement, the International Monetary Fund Chief stated that there was no “clear assurances” given in important sections.
It is a “vital starting point” – this was what the European Central Bank and the European Commission thought about the list of reforms presented by Greece.
“We call on the Greek authorities to further develop and broaden the list of reform measures, based on the current arrangement, in close co-ordination with the institution”. This is also what the Eurozone said after the Euro group talks on Tuesday.
Pierre Moscovici, the Economic Affairs Commissioner said the deal “averted an immediate crisis” but “it does not mean we approve those reforms, it means the approach is serious enough for further discussion”.
Greece will receive more funding from its European lenders only when there is a detailed approval of its proposed reforms. The previous loan is due to expire on Saturday, with Greece owing over €320 billion.
However, the fear of Greece being forced to quit the one currency zone has been abated, but further negotiations are on-going.
“In some areas like combating tax evasion and corruption, I am encouraged by what appears to be a stronger resolve on the part of the new authorities in Athens. In quite a few areas, however, including perhaps the most important ones, the letter is not conveying clear assurances that the government intends to undertake the reforms envisaged”. Christine Lagarde, the head of International Monetary Fund made this statement in her response to the Eurozone.
Christine Lagarde’s statement shows that the European Lenders of Greece are not sure that Athens would really implement the reforms. This means that Greek has just won one battle, but still has to win the battle of regaining the trust of its creditors.