Bloomberg News

Greek Official Says Troika to Remain Until Budget Complete

July 29, 2012

Representatives of Greece’s international creditors may extend their visit to the country until the government has completed work on a two-year, 11.5 billion-euro ($14 billion) budget plan, a Greek finance ministry official said today.

Members of the so-called troika were originally due to leave at the end of July and return at the end of August to complete a review on progress of the government’s budget cuts for this year and plans for 2013 and 2014, the official said in an e-mailed statement. That would have led to a significant delay in the next disbursement of loans to Greece, said the official, who asked not to be identified.

The official said the troika will assist in identifying budget savings. They will then depart Athens to write the review that will open the way for the payment of the funds, he said.

Prime Minister Antonis Samaras and his coalition partners, Evangelos Venizelos of Pasok and Fotis Kouvelis of Democratic Left, are to meet again on Monday, July 30, to determine the savings required to receive the funds pledged under Greece’s two rescue packages totaling 240 billion euros.

Coalition leaders have agreed on most of the austerity measures demanded by creditors and are now considering pension and wage cuts to find the final 1.5 billion euros of savings still needed, Reuters reported today, citing an unidentified individual close to the talks.

Greece, which held consecutive elections in May and June as public opposition to spending cuts grew, risks running out of money without the disbursement of 4.2 billion euros due last month as the first installment of a 31 billion-euro transfer. Citigroup Inc. said last week there’s now a 90 percent chance Greece will leave the euro in the next 12 months to 18 months.

If Greece doesn’t stick to its agreements, there’s no other solution than for it to leave the euro area and introduce its own currency to regain competitiveness by devaluation, Hermann Otto Solms, deputy president of Germany’s lower house of parliament, told WirtschaftsWoche in an interview published today.

To contact the editor responsible for this story: Maria Petrakis at

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