If the Greek parliament approves the agreement reached with Eurozone leaders on 12 July regarding reforms and Eurozone member states decide to provide Greece with a new loan, money for this endeavour will not come from Latvia’s budget or taxpayers’ wallets.
As confirmed by Finance Ministry’s representative on Wednesday, 15 July, Greece’s bailout will not cost Latvian taxpayers a single cent, as the money will not come from the funds paid by member states to the European Stability Mechanism. Regardless of the allocation of a loan to Greece, Latvia’s payments to ESM will not grow. Neither will the country’s external debt increase because of it. Funds necessary to provide Greece with another loan will be acquired by ESM by means of borrowing funds from financial markets, explains European Affairs Committee’s Chairperson Lolita Cigane.
«European leaders are largely sceptical about the Greek government’s promises. The level of trust in Greece is very low. With that, if the loan plan is realized, funds will be paid to Greece in small amounts and only following the realization of specific reforms. This gives way to the hope that this money will not disappear. We hope it will help the country carry out painful but needed reforms in order to restore economic growth and trust of financial markets, as it was once successfully accomplished by Latvia,» – says Cigane.
As noted by the head of the committee, in order to reach an agreement about the loan, it is first necessary to have it approved by leaders of European member states at a meeting of the European Council. The procedure in force provides that Latvia’s position on this matter will be developed by the government. However, it will be necessary to approve it in the Saeima European Affairs Committee, as reported by the Saeima press-service.
Finance Minister Janis Reirs mentioned in an announcement to the media that «Eurozone’s finance ministers have made it clear – Greece will not achieve results with blackmail and threats! It is possible to reach an agreement in regard to the loan plan only by fulfilling duties the country has taken on itself. This is why finance ministers will carefully assess the success of Greece’s accomplished reforms before launching a new loan plan.»
«It is not Eurogroup’s goal to keep or kick out Greece from Eurozone at any cost. Eurogroup’s goal is to achieve the realization of reforms in Greece. We are interested in having Greece, as a member of the EU, Eurozone and NATO, to strengthen its economy, safety and welfare of its people by realizing reforms,» – said Reirs, reminding that Greece’s economy had come back to a state of growth in 2014.