Eurogroup reports progress on Greece and Cyprus

EU finance ministers heard positive reports on Greece’s moves towards economic stability and the recovery of the Cypriot economy at their meeting in Brussels on Monday.

Progress was being made in Greece, Eurogroup chief Jeroen Dijsselbloem said as ministers took stock of the ongoing second review of implementation of Greece’s economic adjustment programme.

The second review includes a budget for 2017, the medium-term fiscal strategy and labour market reform.

Following a review mission by the institutions to Athens at the end of October, the Eurogroup has called on the Greek authorities and the mission staff to continue their constructive cooperation and to finalise the review rapidly.

Mr Dijsselbloem said “it was in everyone’s interest to finalise the second review as soon as possible”. He said the next 5 December meeting would be an important one regarding Greece, for ministers to get more sense of some of the important reforms taking place, such as “labour market reform, social system reform, the fiscal trajectory for the coming years, particularly the next years budget and the 2018 budget”.

The Eurogroup was also updated on the technical assistance provided to the Greek authorities to date by the European Commission’s structural reform support service (SRSS). The service was set up in July 2015 to assist member states in implementing growth-enhancing administrative and structural reforms. The Eurogroup expects the service to focus on helping Greece implement reforms.

Regarding Cyrpus, the Eurogroup welcomed positive reports on the country’s strong economic recovery – 2.5 to 3 per cent economic growth, with “good work being done by the Cypriot authorities including in the financial sector”.

There were also encouraging reports from the Cypriot minister about the state of play on the possible reunification of Cyprus, with particular attention to economic and financial issues. “We learned about the positive economic effects this process may have, but also realised that adequate and effective preparation in view of the ground that remains to be covered is very important,” said Mr Dijsselbloem.

On Banking Union, ministers heard about the ongoing work relating to the stress tests conducted in July 2016, the challenges related to addressing non-performing loans and the aim of reducing the number of supervisory options and national discretions in the euro area banking sector in order to ensure a more level playing field.

Elke Koenig, Chair of the Single Resolution Board (SRB), presented a progress report on the SRB’s activities, the collection of contributions to the Single Resolution Fund and the loan facility agreements with individual member states.

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