Reforms Undone, Greece Risks Losing Troika Refunds

FILE - The sun rises behind the European Central Bank in Frankfurt, Germany, Wednesday, Sept.12, 2018. The governing council of the ECB will meet on Thursday. (AP Photo/Michael Probst)

Prime Minister and Radical Left SYRIZA leader Alexis Tsipras’ claim he’s bringing a recovery from a more than 8 ½-year long economic crisis is being undercut by the risk of losing 750 million euros ($851.21 million) under a debt relief deal because his government hasn’t finished agreed reforms.

Tsipras had eagerly sought the agreement last year from the Eurozone and claimed a big victory when Greece was allowed more time to repay 326 billion euros ($369.99 billion) in three international bailouts.

The deal also would see the return of monies from about 4.8 billion euros ($5.45 billion) of profits from Greek bonds held by Eurozone central banks, to be handed back to Athens by mid-2022 in semi-annual installments of 750 million euros.

The money was designed to be an incentive for Greece to stick to reforms and austerity agreed with the Troika of the European Union-European Central Bank-European Stability Mechanism (EU-ECB-ESM) and the Washington, D.C.-based International Monetary Fund (IMF) which took part in the first two rescue packages of 240 million euros ($272.39 million) but not a third of 86 billion euros ($97.61 billion) in 2015.

The European Commission will issue a report on Feb. 27 on the progress of reforms, some of which Tsipras is trying to wiggle out of after plummeting in polls and with elections coming this year.

“The report is likely to say that Greece has not completed the agreed reforms,” one Eurozone official who wasn’t identified told Reuters. “Eurozone finance ministers will not allow the disbursement unless Athens completes the actions between February 27 and March 11,” the official said.

There are 16 various reforms at different stages of completion, but the key ones, officials said, were linked to the clearance of government arrears, the rollout of the primary healthcare system and centralized healthcare procurement and the legal framework for bad loans and pushing home foreclosures that Tsipras said he would halt.