Coverage: Greece back in the news

Greece is looking to raise money as part of the conditions to its creditors. The country is struggling to raise cash and meet new conditions in order to secure more bailout money. One plan is to sell a stake in the Piraeus port, taking it private.

The Wall Street Journal story by Costas Paris and Alkman Granitsas had these details about the sale:

Greece has told creditors it expects to raise at least €500 million ($545 million) from the privatization of the Piraeus port, according to Greek officials.

The privatization plan has been controversial, and politicians in Greece’s new leftist-led government have publicly expressed conflicting signals about whether it would go ahead, spooking creditors. Privately, however, senior Greek officials have said it would proceed.

The decision to disclose to creditors the expected proceeds from the planned sale is the latest and clearest sign yet that the government in Athens plans to go ahead.

Greek officials also told creditors they will seek to privatize operating concessions at 14 regional airports, the Greek officials with knowledge of the situation said.

Greece’s previous government has been seeking to sell a 67.7% stake in the Piraeus Port Authority. It would be one of Greece’s biggest divestments, part of an ambitious privatization plan agreed to by the previous government and creditors. Creditors have repeatedly told Athens that the sale of state assets is a must in any new financing deal.

Peter Spiegel and Kerin Hope wrote for The Financial Times that Greek government was trying to appease creditors in order to secure more bailout money:

Athens haggled with its lenders through the weekend to try to narrow differences over economic reforms, but remaining gaps suggested that there would be no immediate relief for Greece’s cash-strapped government.

Creditors have demanded that the country must implement reforms before they will unlock about €7.2bn in undisbursed bailout funds.

Both sides held lengthy talks over the weekend, including 10 consecutive hours on Saturday, after the Greek government sent a full list of reforms to bailout monitors late last week. Athens had set Monday as a deadline to finalise the list.

Officials who have seen the offering said that while it contained concessions, it lacked detail in some of the areas that have caused concerns during previous talks.

But The Associated Press (via US News) reported on March 27 in a story by Derek Gatopoulos and Elena Becatoros that Fitch downgraded the country, adding to its money trouble:

The ratings agency Fitch has downgraded Greece’s sovereign rating amid growing uncertainty over the new government’s pledge to overhaul reforms needed to restart bailout loan payments and avoid default.

The agency late Friday said it had lowered the country’s rating deeper into non-investment grade status from B to CCC, citing “extreme pressure on Greek government funding.”

Rescue lenders are expected this weekend to start reviewing reforms overhauled by Prime Minister Alexis Tsipras’ new left-wing government.

The government has promised to ax austerity measures that cut chronic deficits but kept Greece in a punishing recession for six years.

“Lack of market access, uncertain prospects of timely disbursement from official institutions, and tight liquidity conditions in the domestic banking sector have put extreme pressure on Greek government funding,” Fitch said.

The BBC reported that the country might run out of money as soon as next month:

Greece fears it will run out of cash in April if bailout money is not released.

International creditors have suggested they are ready to extend help on Greece’s €240bn (£176bn; $272bn) bailout until the end of June.

But Mr Tsipras’s earlier reform plans met resistance from EU leaders, with Germany among the most critical.

Officials from the EU, the International Monetary Fund (IMF) and the European Central Bank (ECB) are examining the proposals this weekend, with a response expected in the coming week.

The Greek government said the 18-point reform programme did not include any “recessionary measures”.

In an interview with the Greek newspaper Real News, Mr Tsipras complained of the country’s “liquidity problem”, but added: “I believe that will be tackled immediately once we reach an agreement over reforms.”

Bloomberg’s Paul Tugwell and Nikos Chrvsoloras that Greek Prime Minister Alexis Tsipras isn’t living up to his campaign promises:

Tsipras’s Syriza party was elected Jan. 25 on a platform of easing austerity measures and restructuring debts related to the nation’s bailout. While the government has retreated on those positions, resulting in a Feb. 20 agreement with euro-area partners to extend a loan accord until the end of June, it faces an uphill task persuading creditors that Greece is making the pledged reforms.

Greece has red lines and won’t agree to any “recessionary measures” such as cutting wages or pensions or allowing mass layoffs, Tsipras told Real News newspaper in interview published yesterday.

Negotiations with Greece’s creditors are continuing and the government is presenting a program that would allow a primary budget surplus of 1.5 percent of its 2015 economic output, Finance Minister Yanis Varoufakis said in an interview also published Sunday in the Athens-based To Vima newspaper.

The world is watching to see if Greece can secure the next round of bailout dollars and keep its economy together. The people are tired of austerity measures, but the government can’t escape what the rest of the Eurozone wants in order to give them more money. It’s a mess and one that won’t likely be fixed with the next round of cash.