BRUSSELS (MNI) – Greece’s budget deficit reduction plan and its
structural reforms are outpacing expectations, Jean-Claude Juncker,
Luxembourg Prime Minister and head of the euro-using currency club, the
Eurogroup, said on Monday.

Greece, which ran into difficulty after it revealed its budget
deficit was more than four times the EU’s stipulated 3% limit, was
offered a E110 billion lifeline by the Eurozone and the International
Monetary Fund in return for implementing a strict austerity plan to curb
its debts.

Juncker said the finance ministers discussed the Greek programme at
their meeting and concluded that the way Greece is implementing the plan
“clearly shows the willingness of the Greek government to have the Greek
programme on track.”

He said the achievements so far have “outpaced our expectations.”

The European Commissioner for Economic and Monetary Affairs, Olli
Rehn, told reporters that “the Greek government is pursuing very
substantial structural reforms with determination.”

He said those actions were “fully in line” with the memorandum of
understanding of the E110 billion loan deal.

He said a formal delegation from the European Central Bank, the
European Commission and the International Monetary Fund would visit
Athens later this month and would make a formal assessment in August
about whether Greece had met the conditions so that the second tranche
of loans could be released.

“The purpose of this mission is to make a full assessment…to
verify whether the conditions have been met,” Rehn said.

Juncker and Rehn said the finance ministers had also discussed
Spain.

Spain’s reform plans are “very demanding, very ambitious,” Juncker
said.

He said ministers are “very happy about what is happening in Spain”
and that they thought the reforms are “pointing in the right direction.”

Rehn said “only by making concrete and rapid progress” on their
promises would the 27 European Union countries be able to restore their
credibility.

He said he wouldn’t prejudge the outcome of EU-wide stress tests
but that “the EU banking sector is, overall, resilient.”

Backstop mechanisms will be in place, if needed, Rehn said.

“We need to reinforce confidence in the EU recovery…by
delivering on all fronts,” Rehn said.

–Brussels: 0032 487 (0) 32 803 665, echarlton@marketnews.com

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