Troika Skeptical Of Greek Leaders' Economic Optimism

Various Greek leaders have proclaimed the worst over for the desperately troubled nation. The basis for that optimism - a primary surplus - however is being brought into doubt by none other than the Troika (the overseer of the bailouts). As ekatherimini reports, the troika has doubts about Greek projections for a primary surplus this year and next and has begun the process of discussing with Athens the contents of the 2014 budget. Skeptical of Greek projections of a 1.5% of GDP primary surplus this year, it is also ironic that the Greek leaders themselves are downplaying the size of the surplus for fear that handouts will sour. All-in-all, it seems, Greek data (in light of the extreme unemployment) is anything but trustworthy - especially in light of further doubts over the effectiveness of the unified property tax.

Via ekatherimini,

The troika has doubts about Greek projections for a primary surplus this year and next and has begun the process of discussing with Athens the contents of the 2014 budget, which Greece’s lenders believe contains several areas that need closer inspection.

...The troika is also skeptical about Greek projections for a primary surplus of 1.5 percent of GDP at the end of next year.

It is thought that one of the reasons Greece’s lenders are downplaying the possibility of Athens producing a sizable surplus is that they are alarmed by the debate in Greece about how this amount will be allocated and whether social spending could be increased.

With regard to the 2014 budget, the troika still has doubts about the effectiveness, in terms of revenue raising, of the unified property tax. Next year will be the first time the levy, which combines several property taxes into one, is applied.

Troika officials are paying particular attention to the state of Greece’s tax administration, which will be key to whether the government can hit its revenue targets. Any lack of convergence with the revenue goals agreed with the troika would make further fiscal measures necessary.

Greece’s Finance Ministry also informed the troika that the government would not meet its target of paying off this year all of the 8 billion euros in arrears that it had amassed.