To play it safe, Greece won’t start selling bonds until well after it exits the bailout. Instead, the government, which is being advised by Paris-based Rothschild & Company, will pick a moment in the next two years when market conditions seem favorable. A cash buffer of up to €18 billion, funded by creditors, may help Greece secure the liquidity it needs in the meantime.
Much also depends on how Greece’s recovery unfolds. The economy has expanded modestly since last summer, and protests are now fewer and farther between as glimmers of a rebound emerge. In Athens and on the sunny Greek islands, tourists are packing hotels, bars and tavernas. Chinese and Russian investors are plonking money down on discounted residential and commercial real estate. Exports are rising, mainly on the back of refined oil products.
But those gains have yet to filter more broadly through the economy. Unemployment, which has fallen from a peak of 28 percent, is still stuck above 20 percent, the highest in the eurozone. Over half a million Greeks left during the crisis in a brain drain that has hampered a recovery.
Worryingly, more people are at risk of poverty, including large families and workers struggling with sharply reduced salaries and an explosion of precarious contracts. The Organization for Economic Cooperation and Development, a group of rich nations, warned recently that poverty in Greece had “risen dramatically.”
As part of his growth plan, Mr. Tsipras has vowed to reverse some of the harshest austerity after August. He wants to raise the minimum wage and possibly restore unions’ collective bargaining power, which was cut under the terms of the bailouts.
With creditors seeking to strike a deal ahead of their meetings on Thursday, though, the Greek parliament last week rushed to pass scores of additional austerity laws that the government had been delaying. They include deeper pension cuts, a broadening of the tax base to low-wage earners and new property and value-added tax increases. Those measures will kick in even after the bailout ends.
Throughout, Greece’s creditors will be watching to make sure it doesn’t backslide.
Klaus Regling, the German chief of the European Stability Mechanism, one of Greece’s lenders, told Mr. Tsipras during a visit to Athens last week that Greece had the potential to be Europe’s next “success” story.
“As long,” Mr. Regling added, “as it sticks to the agreed economic reforms even after the end of the third memorandum.”