BRUSSELS (MNI) – Additional budgetary measures announced by the
Greek government on Sunday, including a levy on real estate, could
significantly boost Athens’ chance of meeting the fiscal targets tied to
its EU-IMF bailout, the European Commission said.

The new measures, “will go a long way in to meeting the fiscal
targets,” EU Economic and Monetary Affairs Commissioner Olli Rehn said
in a statement.

Staff from the Commission will return to Athens “in the coming days
to provide technical support to the Greek authorities,” Rehn said. He
added that a formal review by Commission, IMF and European Central Bank
officials to determine whether or not the country will receive the next
tranche of bailout aid could be concluded by the end of September.

The EU Commissioner also said that a planned debt exchange
involving Greece’s private sector creditors was “proceeding according to
the plan of 21 July.”

The July 21 plan envisages that private creditors holding 90% of
Greek sovereign debt maturing between now and 2020 would participate in
the crucial deal. Greek authorities have warned that the deal could be
jeopardized if the participation rate is lower. As of last Friday, about
60-70 percent of the Greek government’s private sector creditors had
indicated a willingness to participate, according to the Institute of
International Finance, a Washington DC-based group involved in
coordinating the deal.

In recent weeks EU officials have turned up the pressure on Athens
to do more to improve its public finances, repeatedly warning the
government to fulfill all the conditions tied to its emergency bailout
loans or risk missing out on the next tranche of aid.

The inspectors from the Ccmmission, IMF and ECB abruptly halted
their review mission in Athens earlier this month after a dispute with
Greek authorities over the government’s lack of progress on reforms.

Commissioner Rehn again called on Eurozone governments to implement
all the decisions taken by EMU leaders at their July 21 emergency summit
in Brussels. Among the key measures is a planned expansion of authority
for the European Financial Stability Facility, which will be allowed to
buy bonds in the secondary market, recapitalize banks and offer
pre-emptive financing to EMU countries that are not under bailout
programs. However, ratification of that decision by national parliaments
is being held hostage to domestic politics in some Eurozone countries.

“Once again I call on the euro area member States to finalize the
technical issues and implement as soon as possible the decisions of the
Eurozone summit of 21 July,” Rehn said.

“I expect the Eurogroup meeting this Friday in Wroclaw to overcome
the remaining hurdles,” he added, noting that “the ratification of the
agreed EFSF reform in the member states is another urgent priority.”

A controversial deal under which Greece would provide AAA-rated
Eurozone member Finland with collateral for its contribution to the
Greek bailout packaged has also held up finalisation of the new rescue
package.

–Brussels newsroom +324-952-28374 pkoh@marketnews.com

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