Greece Said to Make Progress on Euro-Area Officials’ Call

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Greece and euro-area authorities pledged to press ahead with efforts to release aid payments after progress in recent days, according to a Greek Finance Ministry official with knowledge of a conference call held Wednesday.

Two euro-area officials agreed that talks were making progress, recognizing the advances by Greece while insisting that more work needs to be done to reach a conclusion of this part of rescue. All three asked not to be named because the discussion was private.

To tap rescue funds, Greece must win approval from the negotiating trio of the International Monetary Fund, the European Commission and the European Central Bank, now known as the Brussels Group. If Prime Minister Alexis Tsipras can strike a deal with the creditors’ group, it will pave the way for euro-area finance ministers to consider making a payment.

Finance deputies stand ready to make recommendations to their ministers as soon as there is a deal between the Greek government and the institutions, one of the euro-area officials said. The deputies used Wednesday’s conference call to take stock of the negotiations and they are set to meet next week.

Tsipras has resisted demands for more austerity as he seeks to persuade the euro area to release more aid. To keep from running out of cash in the meantime, Greece has turned to ECB loans to its banking sector to prevent a financial collapse.

ECB Limits

The Greek government has lobbied the central bank’s regulatory arm unsuccessfully to be allowed to sell more short-term debt to the country’s banks. Greece also has lost its waiver that allowed the ECB to accept the country’s junk-rated debt as collateral.

ECB President Mario Draghi said Tuesday that the waiver was an “exceptional and temporary measure” granted in 2010, on the condition that Greece comply with its European and IMF rescue requirements. In a letter to European Parliament member Kostas Chrysogonos, released Wednesday by the Frankfurt-based central bank, he repeated that the ECB can’t help Greece with its debt load.

“The ECB cannot engage in a restructuring of sovereign debt held by the Eurosystem as this would amount to monetary financing, which is prohibited,” Draghi said.

Paying the IMF

So far Greece has sought to meet all of its international obligations. There is “no possibility” that Greece will miss a payment to the IMF on April 9, Greek govt spokesman Gabriel Sakellaridis said in e-mailed statement.

Ahead of the euro-area conference call, Greece sent its creditors more details on its budget and economic proposals in a 26-page e-mail, the Greek official told reporters in Athens. Priorities include labor agreements and no cuts to auxiliary pensions, the official said.

Greece will overhaul the property tax system for 2015 as it tries to avoid blowing a hole in its budget. The government will cover lower revenue through spending cuts elsewhere, the official said.

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