ESM Board of Directors approves 7.5 bln euro disbursement to Greece

The Board also authorised the first disbursement of this second tranche of 7.5 billion euros to Greece. The country will use the 7.5 billion euros to meet debt servicing obligations and to help clear domestic arrears. The Board of Directors’ decisions follow the Greek government’s completion of all prior actions.

ESM Managing Director Klaus Regling said: “Today’s decision to disburse 7.5 billion euros to Greece is a recognition of the Greek government’s commitment to carry out essential reforms. It has passed legislation that will: reform the pension and income tax systems; establish a new privatisation and investment fund; enable the sale of non-performing loans; and introduce an automatic fiscal adjustment mechanism to be triggered in case fiscal targets are not met. Thanks to these measures and other reforms implemented in recent months, Greece is on track to return to economic growth. As announced last month, ESM members are in principle willing to support Greece’s efforts with further debt relief measures, including short-term measures that can be applied during the course of the current programme. This depends on Greece’s continued fulfilment of the pre-defined conditionality.”

The 2.8 billion euros of the second tranche remaining after the first disbursement will be available to Greece upon completion of a set of milestones and satisfactory clearance of domestic arrears by Greece. It is subject to a further Board of Directors decision. After the disbursement approved today, ESM financial assistance for Greece will reach 28.9 billion euros, out of a total programme volume of up to 86 billion euros. The ESM and the EFSF together have so far disbursed 170.7 billion euros to Greece (including the amount approved today), making the rescue funds by far the largest creditor to Greece.

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