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The Greek government is scraping money from all possible sources. Its latest endeavour is to divert resources from programmes under the National Strategic Reference Framework (NSRF). Yesterday, the Economy Minister, Georgios Statakis, withdraw at the last minute his decision to divert funds available to regions for payments under co-financed projects. At the same time, the Chamber of Accounts (or audit office) is rolling out a law that will facilitate the boards of state-owned companies in investing their assets in government securities (repos). In parallel, it was decided to postpone the payment of various government liabilities amounting to €700 million due in April.

It is clear that the cabinet’s economic team is scouring all options to muster some liquidity and enable the servicing of its debt in April. The first step is on Wednesday, when the Ministry of Finance will issue 6-month treasury bills, and it is still uncertain whether they will be backed or not. On Thursday, Greece is due to transfer 450 million euros to the IMF. At the same time, it has to pay out salaries to government employees. Reportedly, if Wednesday’s treasury bills are backed without a hindrance, then the treasury stock will suffice until the Eurogroup meeting in Riga on 24 April. According to the cabinet’s economic team, cash in the coffers can be increased in the following ways:

1. Tapping into NSRF resources. The fact that the Ministry of Economy withdrew its decision to divert resources from the regions intended for payments under co-financed projects, does not mean that payments on sector programmes are carried out normally. Payments on completed projects seem to be selective. This has been corroborated by the Panhellenic organisation of technical companies, which claims that 59 projects have yet to see their payments totalling €262 million. €170 million of concessions for motorway building have also been withheld. The requests for these payments were submitted on 20th March. According to reports, requests for payments that had to be submitted this week for projects under the Accessibility Improvement operational programme of NSRF, have been postponed until further notice. Failure to pay beneficiaries for their projects leads to delays in the submission of payment requests by the government to the European Commission. The latter extends NSRF project funds after presentation of completion reports and when beneficiaries have already received their money from the national funds.

2. Delaying payments into future months. The government has reportedly decided to reschedule payments on various obligations in April, thus saving around €700 million. A substantial amount, as it covers both the IMF tranches and interest payments for April. However, payment freezes deprive the market and the economy of liquidity

3. A legislative amendment affecting state-owned companies. It will allow the state to foot potential losses resulting from the investment of their assets in government securities. In practice, this is an extension of the same policy covering social insurance funds and legal entities. However, insurance funds are not known to have invested in repos so far. On the other hand, some state-owned companies are already preparing to make some purchases. The Hellenic State Railways are reported to have invested something in the order of 100 million euros over the last few days.