–Says Lenders Must Agree On Troika Debt Report But Differences Remain

By Angelika Papamiltiadou

BRUSSELS (MNI) – Greece will run out of money in mid-November and
needs to receive a E31.5 billion loan disbursement from its bailout
package as soon as possible, Greek Prime Minister Antonis Samaras said
Friday.

“On the 16th of November the country will run out of cash. We would
like to receive the loan tranche immediately after the release of the
troika report,” Samaras told reporters here after the EU summit,
referring to an eagerly-anticipated analysis by Greece’s official
creditor group, comprised of officials from the European Commission,
European Central Bank and International Monetary Fund. “We expect this
to happen by the middle or end of November,” Samaras added.

Samaras said his government is implementing the measures and
previously agreed commitments that its creditors require. But the
lenders still do not have a unified view of how to address a number of
key issues: the extra time Greece is requesting to meet its fiscal
targets, the funding gap that such an extension will produce, and an
upcoming report on the sustainability of the country’s sovereign debt.

“All three are linked and there is still a difference of opinion,”
Samaras said. The disagreement “is okay, as long as it doesn’t happen at
our expense.”

Commenting on the sentiment inside the EU summit meeting Thursday
and Friday – his first – Samaras expressed satisfaction that all the
leaders had signalled their solidarity and their confidence in Greece’s
recovery and reform efforts.

“Sentiment is changing and you can see it in the [EU summit]
communique on Greece,” he said. “It was a very positive statement. We
can benefit from the decisions on bank recapitalization at the EU level,
since that will allow us to write off the money spent [on Greek banks]
from the [government's] outstanding debt figure at some point.”

However, in direct contradiction of this point, Germany’s
Chancellor Angela Merkel said Friday that there will be no retroactive
bank recapitalization by Europe’s new rescue fund, the European
Stability Mechanism.

Asked by MNI to comment on Merkel’s assertion, a top Greek Finance
Ministry official predicted that, “Germany will come around in the end.”

The EU stance towards Greece “has changed significantly,” Samaras
said.

He added: “I want to address all those speaking about Greece’s exit
from the Eurozone to say that this is no longer possible. But I have
highlighted to my counterparts the problems we are facing from rising
unemployment, the liquidity shortage and the ongoing recession.”

Samaras argued that economic growth needs to return to Greece, and
he said he is lobbying his European counterparts so that the criteria
for the allocation of EU funds are changed to fit Greece’s current
needs.

“I explained to them that Greek society has reached its limits.
Liquidity which is the blood of the economy, is now zero. Unemployment
among the youth has reached a nightmare scenario. This is not Europe!”
he exclaimed. “This is how extremists rise.”

Samaras said he fully realized that the new austerity package “is
very tough.” But “it is the last one,” he stressed.

“I won’t be satisfied until we return to a growth path,” the Greek
premier said. “Even [European Commission President Jose Barroso, after
my speech last night, said that Greece has reached the limits of fiscal
discipline.”

Samaras appeared satisfied with the stance of French president
Francois Hollande during the Summit, saying that Hollande’s input had
helped shape a more positive communique on Greece. He noted that
Hollande will visit Athens soon, as will Italian Prime Minister Mario
Monti.

Asked how the question of Greece’s debt sustainability will be
resolved, Samaras declined to answer. Many of Greece’s official
creditors believe the current target of 120% of GDP by 2020 – a line in
the sand for the IMF – is unattainable. How that dilemma is addressed
will be a key aspect of the troika’s upcoming Debt Sustainability
Assessment.

“Allow me not to say anything else about it at this stage” the
Greek premier said.

–Brussels newsroom, apapamilitadou@marketnews.com; +324-754-38314

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