EU to have serious concerns about Greek debt

In line with the 13 July statement, a new independent fund (the "Fund") will be established and have in its possession valuable Greek assets. An independent task force is to be appointed by October 2015, targeting steps to implement recommendations by March 2016.

The document proposes a heavily front-loaded policy agenda, including a number of prior actions to be passed by the Greek parliament. They mainly concern fiscal issues, but also the resolution of NPLs, product markets and privatisation. The Greek authorities have also committed to pass in October 2015 a number of structural measures to support the medium-term fiscal strategy, to come into effect in 2017 and 2018.

The document does not mention long-term debt prospects. The EU mentioned it had "serious concerns" about the sustainability of Greek debt, seeing it at 201% of GDP in 2016, 175% in 2020 and 160% in 2022. The EU has suggested longer maturities, grace periods for Greece. 

"While the EU's stance is not new news, it is now up to it and the IMF have to find common ground. The IMF's views on the need for substantial debt relief will be a necessary condition for its participation in the third bailout later this year", says Barclays.