Germany blocks €15 billion Greek loan installment over islands VAT cut

Α Decrease font Enlarge font
Germany blocks €15 billion Greek loan installment over islands VAT cutESM approves in principle the disbursement of last loans to Greece

Prime Minister and Radical Left SYRIZA leader Alexis Tsipras’ decision to give five Greeks islands overloaded with refugees and migrants an exemption from a Valued Added Tax (VAT) break without consulting the country’s creditors has led Germany to block release of a 15-billion euro ($17.44 billion) installment.

The money is the last from a staggered third bailout of 86 billion euros ($99.97 billion) he sought in the summer of 2015 after saying he wouldn’t because it came with more of the crushing measures he vowed to reject but agreed to implement.

That included an avalanche of tax hikes and new taxes, including raising the VAT on remote islands as well as the refugee-laden islands of Lesbos, Samos, Chios, Kos and Leros where some 15,000 are being held, with most seeking asylum after the European Union shut its borders to them.

Three rescue packages of 326 billion euros ($378.96 billion) end on Aug. 20, leaving Greece to the mercy of the markets and years of monitoring from the Troika of the European Union-European Central Bank-European Stability Mechanism (EU-ECB-ESM).

The Troika put up the third bailout while the Washington, D.C.-based International Monetary Fund (IMF) took part in two first loans of 240 billion euros ($278.99 billion) but was replaced in the latest by the ESM.

A “clean exit” from the bailouts

The lenders disputed Tsipras’ claim there would be a “clean exit” from the bailouts and said they’ll step up scrutiny to make sure he doesn’t renege on reforms, as he did in giving the refugee islands a break without clearing it with them.

Greek banks are also losing access to cheap liquidity through the ECB’s waiver on Greek government bonds, while the country is losing the chance to participate in the ECB bond-buying program.

For the 15 billion euros to be unblocked before the bailouts end, Finance Minister Euclid Tsakalotos pledged the islands discount would expire at the end of the year although Tsipras earlier said it would stand as long as there’s a refugee and migrant crisis.

Tsakalotos told a meeting of the Eurogroup, an informal body where the ministers of the euro area member states discuss matters relating to their shared responsibilities related to the euro that Greece will make up the loss of 28 million euros ($32.55 million) in the VAT exemption some other way although he didn’t say how.

With elections required to be held by October, 2019 and plummeting in polls after reneging on anti-austerity pledges, Tsipras is trying to wiggle out of imposing more pension cuts next year he agreed to after saying it was a Red Line he wouldn’t step over but jumped over at orders of the lenders.

Eurogroup chief Mario Centeno and ESM Director Klaus Regling stressed there should be no change to what has already been agreed. “The next stage, the end of the program, is very important for the building of confidence in Greece, which must remain loyal to the pledges made in the course of the program,” Centeno said.


RELATED TOPICS: GreeceGreek tourism newsTourism in GreeceGreek islandsHotels in GreeceTravel to GreeceGreek destinations Greek travel marketGreek tourism statisticsGreek tourism report


  1. 18/02 10:16

    AHEPA welcomes Congress support for United States-Greek relations

  2. 18/02 10:12

    Undeclared work decreased significantly in Greece during 2018

  3. 18/02 10:08

    BBC radio provides translation of quintessential Greek words

  4. 18/02 10:00

    Video of Good Samaritan saving stranded sea turtle in Crete goes viral

  5. 18/02 09:56

    International tender for casino at Helleniko site on the horizon

  6. 18/02 09:52

    "Greek Freak" Giannis Antetokounmpo to play for Greece in FIBA World Cup

  7. 18/02 09:48

    Concession contract for Crete's new Kasteli Airport to be inked by end of February

  8. 18/02 09:40

    InSETE report records 7% drop in air seats to Greece after several years of rises

  9. 18/02 09:35

    Saudi Arabian Airlines launches new Riyadh-Athens flight connection on June 5

  10. 18/02 09:28

    Juncker expresses condolences for iconic Greek "Baker of Kos" passing

  11. 18/02 09:22

    Book on Google promotes direct hotel reservations in more European markets

  12. 18/02 09:12

    AP: Hundreds stranded as British carrier Flybmi collapses due to fuel cost and Brexit

  13. 18/02 09:07

    EU Commissioner Cretu in Ancient Olympia: Greece has ingredients and tools for success

  14. 18/02 09:01

    Movie Tourism: Cyprus joins race to attract filmmakers for shooting

  15. 18/02 08:52

    Visitors and revenues to Greek museums and sites rise in first ten months of 2018

  16. 17/02 13:06

    Athens airport concession contract extension approved by Greek Parliament

  17. 17/02 12:44

    Award-winning Australian writer Hannah Kent to visit Athens and Thessaloniki

  18. 17/02 12:37

    First Energy Leadership Summit to be held in Athens in June

  19. 17/02 10:20

    Road rules restricting use of vintage cars amended in Greece

  20. 16/02 22:40

    AHI President visits Greece and Cyprus for series of meetings and events

  21. 16/02 22:36

    US government offices in Greece to stay closed on Monday, February 18

  22. 16/02 22:26

    Norwegian Air offering summer deals with $159 one-way to Athens

  23. 16/02 22:13

    Thessaloniki Regional Forum hosts three-day event with Balkan agenda

  24. 16/02 20:44

    Folk Tourism: Greeks mark arrival of Spring with ancient tradition of Martis

  25. 16/02 18:32

    Cyprus Religious Tourism: Spiritual leaders urge churches' restoration

  26. 16/02 16:22

    Athens Half Marathon to take place on March 17

  27. 16/02 12:10

    Mountain professionals gather in Germany to seek their way to the top

  28. 16/02 10:06

    Greek banks: Deal on first home protection a positive step

  29. 15/02 23:57

    Cabinet greenlights changes in Cyprus Investment Program

  30. 15/02 23:50

    Greek “Blessings and Vows” wins best documentary awards

  31. 15/02 23:38

    Greek Minister stands firm on realizing Crete-Attica power connection

  32. 15/02 23:13

    The Hellenic Initiative supports “Agigma Zois” with a $17,000 grant

  33. 15/02 22:19

    iMEdD marks launch with a 24-hour program of events in Athens (video)

  34. 15/02 21:07

    Thessaloniki Metro's trial operation to commence soon

  35. 15/02 19:23

    Six major motorway projects underway in Greece during the next 5 years

  36. 15/02 19:02

    Ancient Greek tragedy "Agamemnon" at the National Theatre of China

  37. 15/02 17:04

    Greek supermarkets to record turnover growth of 1.5% from last year

  38. 15/02 15:59

    Greek MPs back separation of president's election from dissolution of Parliament

  39. 15/02 13:50

    AP report: Seven arrests for counterfeit cash targeting tourism in Greece

  40. 15/02 13:09

    Prince Charles supports more than 2,200 young unemployed people in Greece

  41. 15/02 13:01

    Greece selects Katerine Duska for Eurovision Song Contest 2019

  42. 15/02 12:31

    Greek violin workshops presented in Tarpon Springs, Florida

  43. 15/02 11:21

    Athens to welcome carnival season with event in Plaka on Sunday

  44. 14/02 23:00

    New documentary on Giannis Antetokoumpo’s fascinating career (video)

  45. 14/02 22:52

    Aristotle University of Thessaloniki cooperates with historic foundations

  46. 14/02 22:20

    New UNWTO report: Walking tourism promotes regional development

  47. 14/02 21:41

    62% rise in US air travel demand in next 20 years

  48. 14/02 20:32

    Fashion meets cinema at 1st Athens Fashion Film Festival on February 25-27

  49. 14/02 18:01

    Pet Tourism: Young Greek man in Crete dedicates his life to stray dogs

  50. 14/02 17:09

    City Break: Saint Valentine’s evening out in Athens costs nearly €70

  51. 14/02 16:49

    MasterCard: Contactless transactions in Greece grew 3,662% since 2016

  52. 14/02 16:41

    Media: ExxonMobil to announce huge discovery in Cyprus's plot 10 next week

  53. 14/02 16:18

    Ferry service to resume from Greek ports of Piraeus, Rafina and Lavrio on Friday

  54. 14/02 15:34

    Greeks in UK will have to travel to EU countries to vote in European elections

  55. 14/02 14:28

    Exiled Turks fleeing Erdogan regime find new lives in Greece

  56. 14/02 12:54

    IMTM: More than 700,000 Israelis to visit Greece in 2019

  57. 14/02 12:53

    Europarliament event on rebuilding Korakou Bridge to take place in Athens

  58. 14/02 12:03

    Main opposition leader repeats pledge for private universities in Greece

  59. 14/02 10:29

    AP report: Penguins celebrating Valentine’s Day with red felt hearts

  60. 13/02 23:43

    World’s largest espionage headquarters opens in Berlin after 12 years

  61. 13/02 23:38

    Mars One goes bankrupt ending private planet colonization project

  62. 13/02 23:37

    Giannis Antetokounmpo holds baby during entire TV interview (video)

  63. 13/02 22:53

    The story behind an ‘Olympic Airways’ plane resting in an Oregon forest

  64. 13/02 22:43

    Athina Onassis to visit Greece for equestrian event after 12-year absence

  65. 13/02 22:33

    Countdown for Cosco's €500 million master plan for Piraeus Port in Greece

  66. 13/02 21:44

    Tourist regions boost construction sector in Greece

  67. 13/02 21:28

    Thessaloniki Documentary Festival organizers announce Greek film lineup

  68. 13/02 19:26

    10 Greek startups participate in Infacoma 2019 exhibition

  69. 13/02 15:02

    Melbourne prepares for Lonsdale Street Greek Festival on February 23-24

  70. 13/02 14:52

    Strong winds keep ships docked at ports across Greece

  71. 13/02 13:55

    Athens Acropolis Museum presents scholars of Ottoman Archives

  72. 13/02 12:39

    Crete University researchers win prize for stroke response platform

  73. 13/02 10:18

    Giannis Antetokounmpo stars in Aegean Airlines commercial (video)

  74. 13/02 02:40

    Air France to connect Athens and Heraklion to French airports this summer

  75. 13/02 01:56

    Greek port of Piraeus signs deal with Italian ports of Venice and Chioggia

  76. 13/02 01:35

    Airline seat planning for flights to Greece stalls after years of soaring

  77. 13/02 01:29

    CERN chief: Cooperation with Greece can be developed further

  78. 13/02 01:08

    Green main opposition leader meets representatives of German firms

  79. 12/02 23:17

    German Rail DB launches ‘world’s fastest laboratory’ test train

  80. 12/02 23:05

    Procedures for changing signs and passports underway in Skopje

  81. 12/02 22:44

    Greek 'super fund' eyes state-run enterprises in its portfolio

  82. 12/02 20:06

    Religious Tourism: ‘Church’ of scientology sets shop in central Athens

  83. 12/02 20:03

    Aegean Airlines cancels February 13 flight to Brussels due to strike in Belgium

  84. 12/02 19:57

    'Airbnb-effect' cited for strong demand and price rises in certain Greek neighborhoods

  85. 12/02 18:21

    Media: Decisions on borrowers' main residences protection expected next week

  86. 12/02 17:42

    History Tourism: Archanes village in Crete, a charming center of Minoan Culture

  87. 12/02 14:15

    ESM head: Profit returns on Greek bonds holdings reach €1 billion

  88. 12/02 14:09

    €2.9 billion to be invested in Athens Airport after 20-year new concession

  89. 12/02 13:48

    TripAdvisor Forum: Most dog-friendly countries in Europe

  90. 12/02 11:33

    Airbnb's new Global Head of Transportation

  91. 12/02 11:32

    Delphi Chapter 25 head addresses AHEPA Hellas Midwinter Conference

  92. 12/02 10:52

    Greek government spox repeats there is no banks recapitalisation scenario

  93. 12/02 01:58

    Airbnb reveals plan to break into transport and build “end-to-end travel platform”

  94. 12/02 01:46

    Global events mark February 9, 2019 as International Greek Language Day

  95. 12/02 01:10

    Gaming license discussions proceed for iconic Helleniko property development

  96. 12/02 01:00

    Survey: Greece can be a good place for international investments

  97. 11/02 23:22

    Greece honored at Dublin’s Greek Business and Arts Festival on February 24

  98. 11/02 21:15

    Sixth Rail Market Monitoring Report: European passenger traffic growing

  99. 11/02 20:36

    Greek director Lanthimos wins 7 BAFTA Awards with 'The Favourite'

  100. 11/02 18:30

    Rain, snow and strong winds expected in Greece from Tuesday