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Greece to repay more euro zone bailout loans ahead of schedule
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Greece to repay more euro zone bailout loans ahead of schedule
Nov 28, 2023 10:25 AM

Greece will next month repay ahead of schedule 5.3 billion euros ($5.8 billion) of loans owed to euro zone countries under its first bailout, and hopes to repeat the move in 2024, finance ministry officials told Reuters on Tuesday.

The euro zone and the International Monetary Fund (IMF) together lent Greece more than 260 billion euros during its decade-long debt crisis which began in late 2009, in exchange for tough austerity measures.

The country's third bailout expired in 2018.

"On Dec. 15, we will repay earlier than expected 5.3 billion euros to euro zone countries," an official who spoke on condition of anonymity told Reuters, adding that the payment refers to loans maturing in 2024 and 2025.

Greece recently regained its investment grade credit rating after languishing for 13 years in the "junk" category.

Last year, it paid off the IMF, which provided it with 28 billion euros between 2010 and 2014 - two years ahead of schedule. It also repaid early 2.7 billion euros to euro zone partners as part of efforts to improve its debt sustainability, and hopes to continue on the same path in 2024.

"We might repay earlier more bilateral loans next year," a second official told Reuters, without giving more details on the amount or the timing.

Euro zone countries lent Greece 53 billion euros in bilateral so-called Greek Loan Facility (GLF) loans during its first bailout, with maturities extending to 2041. With the planned payment this year, Greece will have repaid a total of about 13 billion euros.

Since emerging from bailouts in 2018, Greece has relied solely on bond markets to cover its borrowing needs. It plans to borrow about 7 billion euros next year.

It has a liquidity buffer of more than 35 billion euros due to higher than expected tax revenues, strong growth and primary surpluses.

Greece sees economic growth at 2.9% in 2024 following a 2.4% expansion this year, more than twice the eurozone average. It also hopes to achieve a 2.1% of GDP primary budget surplus next year on higher investment and strong tourism revenue.

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