Greece will not see the next $11 billion of EU/ECB/IMF troika aid anytime soon.
Eurogroup chairman Jean-Claude Juncker said in a press conference early Tuesday (via Reuters), “The Troika report [on Greek reform progress and aid] will not be ready until the November 13 which is a tentative data for next Eurogroup meeting, I have canceled the October meeting.”
He also said that Greece will not be at risk of default until mid-November according to the Guardian, despite previous reports that it could see a disorderly default as early as this month without a new disbursement of funds.
This announcement comes on the heels of a Greek admission that it will not meet its deficit-reduction goals, despite passing new austerity measures this past month. Juncker joined EU economic minister Olli Rehn and EFSF head Klaus Regling to speak after a Eurogroup meeting in Luxembourg on Monday.
In their remarks, the leaders said they officially discussed “how to maximise the EFSF” for the first time. This suggests that EU leaders could consider new ways to implement or alter the organisation’s powers, which are to be responsible for preventing contagion from sweeping through the European banking system.
Any change in plans could include increased private sector involvement, according to Bloomberg.
They said progress was also made on a viable collateral deal that will satisfy Finland. This signals that a sizable hurdle for ratification of the European Financial Stability Fund could soon be cleared.
According to Bloomberg, Finland will give up potential profits from EFSF emergency loans and speed up payments into a permanent rescue fund in order to receive collateral. That collateral will consist of Greek loans transferred to a trustee, sold, and then invested in AAA-rated securities with maturities of 15-30 years. EFSF’s Regling brokered the deal.
The ratification of the EFSF expansion is expected to take place later this month, though the plan is still awaiting approval from Malta, the Netherlands, and Slovakia.