Fourth memorandum under examination, while a new one is in the making…

The discussions between the government and the Troika heads (in Athens today with new members) will focus on the revision of last year’s memorandum and the negotiations on a new one, which will be broader and longer.

German technocrat Matthias Morse will replace tough guy Servaas Deroose, who is now asked to …resolve Portugal’s problems.

In the shadow of a new phase of downgrades and while the discussion about the possibility of a new loan with a new memorandum is heating up, the lenders’ envoys are arriving in Athens to review our progress in implementing the corrective measures to reduce the 2011 deficit, based on last year's memorandum.

The Troika will ask for particular pressure to be applied in relation to the implementation of privatizations in order to defuse the pressure on the part of the markets. It will ask for further and faster flexibility in the labor market, a crackdown on tax fraud to collect 11.8 billion euros by 2013, the deregulation of professions and the immediate completion of the planning for the mid-term plan for 2012-2015.

The auditors will put state revenue under their microscope, which are falling behind by 1.2 billion euros, and which along with the cost overruns of up to 250 million, are causing concern over the deficit and the budget of 2011. They will also ask for additional measures of 3 billion euros to cover the deficit target for 2011, and we should not exclude new demands if the “black hole” finally "closes" at 5 billion euros.