Deutsche Bank: The primary surplus reduces the likelihood of a third aid package for Greece

The Greek economy is showing signs of stabilization but this does not show on competitiveness, chief economist of the German bank for the Eurozone Mark Wall notes

Deutsche Bank chief economist for the Eurozone, Mark Wall, believes that achieving a primary surplus reduces the likelihood of a third bailout package for Greece.

Speaking generally on the Greek economy he estimates that it has started showing signs of stabilization although he adds that "one would expect a more positive effect on the improvement size of competitiveness." In an interview to Naftemporiki newspaper and referring to the reasons this is not happening he said it is mainly due to the slow progress in structural reforms, for example the issue of non-wage costs of entrepreneurial activity and limited access to credit.

Asked whether it is possible for Greece to return to the markets in 2014, Wall notes that "markets are less fearful than before about a tail risk, thus raising the risk appetite on a broader scale," adding that Greece will be assisted by “the primary surplus and the promise of a debt relief.”

He concludes that "with the dollar bound for revalorization, the rate of the euro to decrease next year and a clearing of the landscape around the political leadership may be next year as well, if the presidential election triggers parliamentary elections in 2015 could be a positive turning point for Greece."