Greece, lenders expect 2013 budget surplus

Greece and its lenders are close to agreeing that Greece will achieve a primary budget surplus this year, a senior Finance Ministry official told reporters on Sunday after senior Greek and EU and IMF officials met.

Reuters reported that hitting a primary budget surplus, before interest payments, is key for Greece because it would trigger a clause in its EU/IMF bailout allowing it to seek further debt relief from its lenders.

“I think we are close to converging on a common, realistic estimate that there will be a small, viable primary budget surplus this year,” the official said on condition of anonymity, after the first meeting in the latest review of Greece’s bailout by its lenders.

“There are four or five budget items on which we still have to fully agree,” the official added.

The latest review by officials from the “troika” of European Union, International Monetary Fund and European Central Bank is expected to last at least until the end of next month.

Athens and its lenders are also very close to agreeing on a joint economic growth forecast for 2013 and 2014, the official said, without revealing the estimates.

Athens said on Thursday that it expected its economy to shrink by 3.8 per cent this year, less than a previous estimate of 4.2 per cent.

Finance Minister Yannis Stournaras said the economy may have bottomed out after a severe, six-year recession, citing government estimates that GDP had expanded on a quarter-on-quarter basis in the second quarter.

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