Greece on track to reduce deficits

The European Commission, European Central Bank (ECB) and International Monetary Fund (IMF) have completed their review mission to Greece to assess the austerity programme's progress (release). Some key points:

The mission and the authorities agreed that the economic outlook is largely unchanged from the previous review, with continued prospects for a gradual return to growth in 2014, supported by inflation well below the euro area average and improved wage flexibility, which are helping to restore the competitiveness of the Greek economy.


Fiscal performance is on track to meet the programme targets, with the government committed to fully implement all agreed fiscal measures for 2013-14 not yet in place.


Actions to fully recapitalise the banking sector as envisioned under the programme are nearing completion, and the authorities have undertaken to develop a comprehensive strategy for the banking sector following recapitalisation. Most of the €50 billion available under the programme for recapitalisation has already been disbursed to Greece and injected into each of the four core banks by the HFSF as advances to cover their capital needs.

Greek finance minister Yiannis Stournaras has confirmed that troika lending to Greece has been secured following the review.

Meanwhile, in Cyprus, Moody's are less than optimistic about the island's future: