Greece reaches deal with creditors on more bailout fund

Greece’s finance minister says his country has struck a deal with its international creditors on the latest set of reforms needed for his country to receive a much-needed new 1-billion-euro bailout tranche.

Euclid Tsakalotos made the announcement in Athens on Friday after a meeting with Greece’s quartet of creditors -- the European Commission (EC), the European Central Bank (CB), the International Monetary Fund (IMF) and the EU’s bailout fund, the European Stability Mechanism.

He said that the reforms required to be carried through by his cash-strapped country involve the establishment of a new privatization fund, the power sector’s shake-up, and opening up the market for non-performing loans.

Greece and the lenders reached agreement on the structure of the new privatization fund which would serve boosting investment and paying down the national debt.

“The new fund will have a supervisory board which will be appointed by both the government and the lenders,” Reuters quoted an unnamed government official as saying.

The official said the supervisory board would have five members, three of whom to be picked by Athens. He noted that both sides will wield veto rights.

The leftist government of Prime Minister Alexis Tsipras plans to speed up negotiations and open the way for talks on debt relief.

Power structural reforms

According to the agreement between Greece and its lenders, the state will take a stake of at least 51% in power grid operator (ADMIE), which is currently owned 100% by the power utility PPC which is itself 51% state-owned . The rest is planned to be privatized.

“We are already achieving significant victories in this hard negotiation with our lenders like the one we achieved yesterday by keeping ADMIE in state hands,” Tsipras told parliament.

The sale of a 66% stake in ADMIE was put on hold after Tsipras won the election in January.

An Energy Ministry official said a 20% stake in the grid operator will be sold to a private investor and 29% will be floated on the Athens stock exchange.

The bill on the latest reforms is expected to be submitted to parliament on Saturday and the government hopes to win parliament's approval on Tuesday.

Back in July, the government of Tsipras agreed to demands for austerity measures in exchange for the €86 billion ($93 billion) bailout that Athens accepted from its creditors to save the Mediterranean state from crashing out of the eurozone.

Greece has already received two bailouts in 2010 and 2012, worth a total of €240 billion ($260 billion) from its creditors following the economic crisis in the Southeast European country back in 2009.

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