Business

By Maram Mazen

CAIRO — Egypt is pursuing a raft of reforms to try to revive an economy weakened by years of turmoil, but analysts say that wooing foreign investors will take time.

Since the 2011 uprising, the Arab world’s most populous nation has suffered a slump in key tourism revenues, slowing economic growth and investment, double-digit inflation and falling foreign currency reserves.

In November, the International Monetary Fund (IMF) approved a $12 billion loan for Egypt after the government committed to reforms, including floating the Egyptian pound, which subsequently plunged against the US dollar.

The authorities also pledged a new investment law with tax incentives, a “one-stop-shop” to simplify investment procedures and a new bankruptcy law.

“Egypt’s economic recovery will come with a lag, until the government follows through on reform policies with a successful implementation,” said Hany Farahat, a senior economist at the Egyptian investment bank CI Capital.

The authorities have also introduced a value-added tax and cut fuel subsidies, moves the IMF said were required to fix government finances and boost investor confidence.

“Everyone is expecting 2017 to be a difficult year,” said Walid Allam, the chief financial officer in Egypt for Swiss elevator manufacturer Schindler.

“But we expect that starting in 2018 there will be a bit of a revival,” he told AFP. “We are talking about a state, not a company that would take a decision and profit from it after a week or two.”

Foreign direct investment in Egypt has fallen from a peak of $13.2 billion in the fiscal year ending in June 2008, to $6.8 billion in the year ending in June 2016.

The tourism sector in particular is reeling from years of upheaval and a series of terrorist attacks, including the 2015 bombing of a Russian airliner carrying holidaymakers home from the popular Red Sea resort of Sharm El Sheikh.

Even before the tumultuous 2011 uprising that ousted longtime president Hosni Mubarak, Egypt’s economy was suffering from decades of structural problems and delayed reforms, said Ahmed Abdelnaby, a strategist at Mubasher Financial Services.

Investors will need time to see the government’s commitment to reforms if the business climate is overhauled, he said.

One of the challenges for Egypt is to diversify its sources of foreign currency, said political economist Amr Adly, non-resident scholar at the Carnegie Middle East Centre.

This is particularly important as the main sources now — workers’ remittances, crude oil exports, the Suez Canal and tourism — “proved to be very volatile and cannot be depended on”, said Adly.

A key part of the government’s efforts should be directed to improving the business climate and reducing bureaucracy for small and medium enterprises and not just foreign investors, he said.

This would help boost local industries, including agriculture and manufacturing, he said.

Potential investors are keen to see additional structural reforms before committing to long-term investments, said Esraa Ahmed, an economist with Mubasher.

She thinks that more than half of the problems facing investors still need to be resolved.

“Investors have always suffered obstacles in procedures, corruption, and bureaucracy. Reforming these issues will take some time,” she added.

The former chairman of the General Authority for Investment, Ziad Bahaa-Eldin, said that fixing “genuine barriers” to investment would have a bigger impact than a new investment law.

These include “the state’s unclear economic and social vision, its competition with the private sector in all fields, the spread of corruption, and clogged, slow courts, as well as security and political conditions,” he wrote in an article for the Ahram Online news website.

Despite the remaining challenges, there are signs that investors are responding positively to the reforms.

In January, Egypt sold $4 billion of dollar-denominated bonds on international markets, almost double its initial target.

“Every time I attend a discussion one can sense that officials are aware of everything they should be doing,” said an official at a multinational company.

ABIDJAN — Fallout from army mutinies, public sector strikes and a cocoa crisis is threatening to derail Ivory Coast’s public finances and turn startling economic growth into a cycle of hardship and social unrest.

Two months into 2017, the government is already facing unforeseen spending that could total roughly half-a-billion dollars, according to a Reuters calculation, just as it is supposed to be exercising budget discipline under an International Monetary Fund (IMF) programme.

How President Alassane Ouattara weathers the instability will reveal whether the much-praised recovery from civil war in Francophone West Africa’s biggest economy can last.

“We’ve all been applauding the country’s economic management in recent years, but it’s mostly been fair skies,” said Alain Feler, the IMF country representative in Ivory Coast. “The current shocks... will require its economic policymakers to demonstrate their ability to navigate through turbulence.”

After coming to power following a decade of political crisis capped by the 2011 war, Ouattara steered the economy to average annual growth of nearly 9 per cent from 2012 to 2015. It was Africa’s fastest growing economy last year.

During the boom Ivory Coast has attracted foreign funding for everything from breweries and shopping malls to construction and power production, and borrowed from international investors through Eurobonds and sukuk Islamic financing.

The IMF’s official projection for growth this year remains at 8 per cent, but the rosy outlook took a major hit last month.

First came the mutinies, when former rebel fighters now serving in the army rose up at bases across the country demanding the payment of bonuses they said they were owed for ousting ex-president Laurent Gbagbo in 2011.

Ivorian authorities have not released details but mutiny leaders say a deal to end the uprising included payments of more than 100 billion CFA francs ($160 million), or about 0.5 per cent of annual gross domestic product (GDP), spread over 8 months.

Ouattara also promised negotiations to persuade teachers and public sector employees to suspend a three-week strike that has turned violent at times. The workers were demanding over $400 million in back wages and a rolling back of pension reforms that would cut benefits and raise their contributions.

“With social unrest, if you want to stay in power you promise everything,” said the regional head of an international bank. “The risk is they enter this vicious circle of social crisis to fiscal crisis to economic crisis.”

‘A huge, huge mess’

Just as the government is facing these unexpected costs, a main pillar of its economy — cocoa exports — is crumbling.

Ivory Coast is the world’s top grower of cocoa but many exporters have defaulted on contracts to buy beans via state marketing board auctions. Those who speculated that world prices would continue rising walked away from the contracts to avoid heavy losses when the market fell.

This has paralysed an industry that typically accounts for a quarter of total exports and around 15 per cent of state revenues, creating a glut.

“It’s a huge, huge mess. And what will be the cumulative damage? Who knows?” an official with one cocoa exporter said.

Ivory Coast sells forward the bulk of its crop, but last Wednesday, the agriculture minister acknowledged that it has been forced to resell cocoa from the defaulted contracts and also auction excess production — 350,000 tonnes of beans in total.

The government is obliged to subsidise the sales to maintain prices for farmers. Without further details from the cocoa marketing board it is impossible to calculate the precise cost to the government. However, an analyst with an international investment bank put it at between $274 million and $313 million.

That would effectively wipe out up to 43 per cent of the government’s anticipated tax revenues from cocoa exports.

Agriculture Minister Mamadou Sangafowa Coulibaly said the costs would be covered by a reserve fund for the sector, but exporters are sceptical that sufficient money is there.

With buyers scarce, a large part of this season’s bumper crop has been left to rot. The impact on those who depend on the cocoa sector — over 6 million people, or a quarter of the population — is growing.

“We’re in debt. We have nothing. I have a worker I employ and I can no longer pay him this year,” cocoa farmer Ali Bamba, 54, said as he walked home from his plantation near the western town of Soubre, a machete in hand.

“How am I supposed to get by now? We see now that the government is abandoning us,” he told Reuters.

Ouattara is facing hard choices. Under the IMF deal, the government has agreed to reduce the budget deficit from 3.8 per cent of GDP in 2016 to 3.7 per cent this year, in return for $659 million in loans.

This year’s target equates to somewhere in the region of $1.4 billion, so an extra half billion in unbudgeted expenditure could have serious consequences at a time when international investors and bondholders are watching for any signs of slippage.

Any cuts to services to curb the deficit risks antagonising ordinary Ivoirians, many of whom have seen few of the benefits of the economic revival and bristle at the government’s regular touting of its near double-digit growth.

On the other hand, the possibility of higher taxes already worries businesses. One director at an Abidjan-based firm told Reuters his company has already faced more than two dozen tax reviews over the past three years, and he fears it will now only get worse.

“Is that going to encourage investors to come?” said the regional bank official. “That creates an economic crisis.”

Even the option of increasing borrowing appears difficult, as liquidity among local banks dries up.

Ivory Coast was forced to call off a five-year, 50 billion CFA franc bond issue this month after demand reached less than a quarter of that amount. Its latest 3-month treasury bill was also undersubscribed.

So far the government has said little about the scale of the problems it faces.

The ministries of budget and finance did not respond to Reuters requests for interviews.

Investors complain that any information they manage to get on the state of the government’s finances is months old.

“There’s more uncertainty in Ivory Coast, just with recent data let alone with current politics, than there is with other countries from Nigeria to Kenya to Ghana,” said Charles Robertson, global chief economist for Renaissance Capital.

Ivory Coast’s leadership at least has a strong reputation among investors to draw on. Ouattara is an economist and former IMF deputy managing director. Vice-president Daniel Kablan Duncan has served as finance minister and as an official with the West African regional central bank. Budget Minister Abdourahmane Cisse used to work for Goldman Sachs.

If, with their combined expertise, they can correct the course, the country could yet solidify its reputation as Africa’s rising star.

“[Ivory Coast] could even come out of this difficult situation stronger,” the IMF’s Feler said.

MUMBAI — Indian telecom giant Bharti Airtel will buy the local operations of Norway's Telenor, it said on Thursday, as the ultra-competitive mobile market is shaken up by the country's richest man.

Tycoon Mukesh Ambani launched Reliance Jio's 4G network in September with an audacious free service for the rest of 2016, followed by vastly cheaper data plans and free voice calls for life.

The move forced rivals to slash their tariffs and scramble to match the deep pockets of Jio, which is backed by Ambani's vast energy-to-chemicals conglomerate Reliance Industries, and picked up 100 million subscribers in its first six months

Bharti's acquisition is the latest movement towards consolidation in India's telecoms sector as major players try to position themselves to best face the tough new environment.

The move, which still needs to be approved by regulators, will enhance its coverage, the company said in a statement to the Bombay Stock Exchange, and see Telenor exit India.

"The proposed acquisition will include transfer of all of Telenor India's assets and customers, further augmenting Airtel's overall base and network," the Indian firm said in the statement.

Last month British mobile phone behemoth Vodafone announced that it was in talks to merge its Indian unit with Mumbai-based Idea Cellular in its own move to counter Jio's rise.

That deal would create India's largest telecoms company. Global brokerage firm CLSA estimated that the pair would command a combined 43 per cent share of market revenue, ahead of Airtel, which is currently the market leader, on 33 per cent.

Reliance Communications — owned by Ambani's brother Anil Ambani — and Tata Teleservices, part of the sprawling salt-to-steel Tata conglomerate, are also reportedly in talks to join forces.

Reliance merged with telecom operator Aircel in September last year. 

Bharti Airtel's shares surged more than 5 per cent in Mumbai morning trade following the Telenor deal announcement.

"The decision to exit India has not been taken lightly," Sigve Brekke, Telenor Group CEO, said in the statement.

"After thorough consideration, it is our view that the significant investments needed to secure Telenor India's future business on a standalone basis will not give an acceptable level of return," he added.

Telecoms analyst Baburajan Kizhakedath said Telenor was quitting India because the intense competition meant there was no scope for growth.

"The Airtel-Telenor deal is probably the best exit route for Telenor," he told AFP.

ABU DHABI — Russian weapons maker Kalashnikov Group's sales doubled last year, helped by demand in the Middle East for its drones, missiles, rifles and military vehicles, making up for US sanctions that cost it its largest market, its chief executive said.

Kalashnikov, whose AK47 assault rifles have armed Russian forces for 70 years, embarked on a modernisation programme and targeted new markets after it was ousted from the United States due to sanctions for Russia's role in the Ukraine conflict. 

It invested 10.5 billion roubles ($182 million) over 2014 to 2017 and targeted new markets for its lines of assault and sniper rifles, guided artillery projectiles and precision weapons.

It plans to invest more than 10 billion roubles over the next two years, Alexey Krivoruchko said.

The programme has paid off and the Middle East is now its largest market, accounting for the bulk of its exports, he told Reuters on the sidelines of the International Defence Exhibition (Idex) in Abu Dhabi.

"Sales have doubled in 2016 with demand growing for weapons, drones and other products," Krivoruchko said, declining to give figures or further details.

Military products now account for 80 per cent of sales with civilian sales accounting for the rest, unlike before US sanctions when it was the reverse, he said. Its civilian products include hunting shotguns and sporting rifles. 

To keep up with orders, it is hiring 1,500 more people to staff its factories 24 hours a day, seven days a week, as it expands operations across its companies, Krivoruchko said.

It is also in advanced talks with a partner in India to start producing assault rifles there, possibly this year.

"India is a very big market and we like the 'Make in India' programme," he said, adding Kalashnikov is also in talks with two other countries to set up similar joint ventures.

Krivoruchko and investor Andrei Bokorev bought a 49 per cent stake in Kalashnikov from state-owned holding company Rostec in 2014. Three weeks ago, they bought another 25 per cent stake from Rostec, taking their ownership to nearly 75 per cent, he said.

"We have more flexibility in making speedy decisions now for faster growth of the company," he said. 

Kalashnikov is keen to return to the US market, but there are no indications yet from the new administration that sanctions will be lifted, he said.

NEW YORK — Yahoo slashed the price of the sale of its core Internet business to Verizon by $350 million following a pair of major data breaches at Yahoo, the two companies announced on Tuesday.

Under the revised terms of the deal, Verizon's purchase of the Yahoo assets will now total $4.48 billion. Yahoo still faces probes and lawsuits related to the breaches, which affected more than 1.5 billion accounts.

The transaction had been delayed due to the hacks. 

Yahoo announced in September that hackers in 2014 stole personal data from more than 500 million of its user accounts. It admitted another cyber attack in December, this one dating from 2013, affecting more than a billion users.

Under the terms of the revised agreement, Yahoo will continue to cover the cost of a Securities and Exchange Commission probe into the breaches and shareholder lawsuits.

However, other government investigations and third-party litigation related to the breaches will be shared by Verizon and Yahoo. 

"We have always believed this acquisition makes strategic sense," said Verizon Executive Vice President Marni Walden.

"We look forward to moving ahead expeditiously so that we can quickly welcome Yahoo's tremendous talent and assets into our expanding portfolio in the digital advertising space."

Prices of Yahoo shares rose 0.3 per cent to $45.24, while Verizon gained 0.4 per cent to $49.39.

BRUSSELS — Greece on Monday agreed to compromise on new bailout reforms in a bid to break a deadlock with its EU- International Monetary Fund (IMF) creditors that has sparked fears of a new Grexit crisis.

Officials representing the lenders will return to Athens shortly for talks on new measures, Eurogroup chief Jeroen Dijssebloem said after talks in Brussels.

Austerity-hit Greece's eurozone and the IMF lenders have been locked for months in a standoff over debt relief and budget targets.

"I'm very happy with that outcome today," Dijsselbloem, the Dutchman who heads the Eurogroup of 19 eurozone finance ministers, told a press conference.

"They will work with the Greek authorities on an additional package of structural reforms of the tax system, pension system and labour market regulation."

Creditor officials left Athens in December after failing to sign off on the second review of Greece's bailout and freeing up new funds.

Dijsselbloem said they will now return "in the very short term".

Markets have been spooked by fears of a return of the "Grexit" crisis, with Athens at risk of default this summer if it cannot unlock the latest tranche of the huge 86-billion-euro ($91 billion) bailout agreed in 2015.

Fears are that a long series of elections, starting with the Netherlands in March and France in April, could delay matters dangerously.

'Not one euro more'

 
Greek Finance Minister Euclid Tsakalotos approved measures that will be automatically triggered if Athens fails to meet budget targets, European sources told AFP.

"The Greek side agrees to legislate the reforms which will take effect from 2019," a Greek government source said on condition of anonymity.

But the deal will include an "inviolable" clause that there will not be "one single euro more of austerity", the Greek source said.

The measures must still be approved by the Greek parliament, most likely in mid-March, a step that has caused problems in previous deals.

Germany's powerful Finance Minister Wolfgang Schaeuble said he was confident the IMF would continue to participate in the bailout.

"I am working on the principle that the [creditor] institutions now have a common position," Schaeuble said ahead of the meeting,.

German Chancellor Angela Merkel meets International Monetary Fund chief Christine Lagarde and European Commission head Jean-Claude Juncker in Berlin on Wednesday, in hopes of making further progress.

The Europeans have been at loggerheads with the IMF over the Washington-based lender's demands for easier budget targets and for Athens' mountain of debt to be reduced.

The IMF insists that budget targets demanded of Greece by the Europeans are too ambitious.

But if the eurozone is going to stick with its plans, then the IMF has demanded what it sees as the necessary tax hikes and pension cuts to meet them before it will lend further to Athens.

Greece, led by leftist premier Alexis Tsipras, refuses the further tightening of the screws, calling it an unfair addition to what he has already delivered.

Meanwhile, eurozone hardliners led by Schaeuble refuse to back down on the IMF's call for debt relief, while insisting at the same time that the IMF stay on board with the bailout.

"It's a very tough negotiation," said a negotiator on condition of anonymity.

Difficult elections

The stakes could hardly be higher as the last such crisis, which followed Tsipras's election, nearly saw Athens expelled from the euro.

A possible default by Athens is still some months off but it needs enough money to repay seven billion euros in debt in July.

The elections in Europe are adding to the pressure, with Dijssebloem himself at risk of losing his job if the polls are right about his party's position.

Anti-EU candidates are leading polls in those elections and officials worry that Greece's future could get ensnared in the campaigning. 

Delays in the talks have worried already jittery markets. 

Greece's two-year borrowing rates have risen as high as 10 per cent in recent weeks while France has also come under some pressure as investors seek safety in German assets.

AMMAN — Royal Jordanian (RJ) on Monday announced its new connecting flights from London Heathrow to Aqaba, where Jordan’s second international airport is situated, via the capital Amman, according to an RJ statement.

The step is “to provide a more convenient connection time in Queen Alia International Airport for the passengers travelling onboard RJ from London Heathrow to Aqaba”, the statement said. This operation will be run on Saturdays.

The daily scheduled flight from London Heathrow Airport to Amman’s Queen Alia International Airport takes off at 16:05 and lands in Amman at 23:05; passengers can then fly to Aqaba on Saturday at 1:15am and arrive there at 2:10 am. This operation will take place between March 31and June 30, 2017, and from September 15 to December 31, 2017.  

CAIRO — Tourists are slowly returning to Egypt, easing pressure on a key sector battered by years of turmoil and the 2015 bombing of a plane carrying Russian holidaymakers.

"There is an increase in the number of tourists. This situation was much better in January than in previous years," Tourism Ministry spokeswoman Omaima Al Husseini said.

Visitors from China, Japan and Ukraine account for a large part of the growth. 

China's top public travel agency, China International Travel Service, reported a 58 per cent increase in tourists flying to Egypt compared with 2015.

"There are more bookings between October 2016 and January 2017 than last year," said Egyptian Federation of Tourism chief Karim Mohsen.

"There is an improvement, especially in cultural tourism in Cairo, Luxor and Aswan," key historical sites, he said.

The uptick is a sign of hope for a country also reeling from the shock of an economic reform programme that has triggered massive inflation.

Once a key foreign currency earner, the tourism sector crashed in 2011 after a popular uprising overthrew veteran strongman Hosni Mubarak, ushering in years of sporadic unrest.

Recoveries in the sector since then have been set back by new crises.

In June 2015, a massacre of tourists at a Luxor temple was narrowly averted when assailants armed with assault rifles and explosives bungled the attack and were intercepted by police.

But in October that year, militants, who are waging an insurgency in the eastern Sinai Peninsula, struck again. They bombed a Russian airliner carrying holidaymakers home from the popular Red Sea resort of Sharm El Sheikh.

All 224 people on board were killed.

Russia suspended flights to Egypt and Britain cut air links with Sharm El Sheikh.

Visitor numbers plunged from 9.3 million in 2015 to 5.3 million the following year, Husseini said.

Recovery hinges on Russia, UK 

But industry officials have cautiously welcomed what they say is a noticeable improvement since October.

In December 2016, 551,600 tourists visited Egypt compared with 440,000 the year before, according to the government's statistics agency.

"Activity has picked up a bit in the winter of 2016-2017," said Tamer Al Shaer, vice president of the Blue Sky travel agency.

He said that included a 30 per cent increase in Ukrainian tourists and a 60 per cent increase in visitors from China, with daily flights to Aswan, a southern city rich in ancient sites.

Japan's HIS travel agency said the number of tourists heading to Egypt "multiplied by four to five times" last year.

Since charter flights from Japan to Egypt resumed in April 2016, they have been on average 80 per cent full, said a spokesman for the Japan Association of Travel agents.

Egypt hosted a record 14.7 million foreign tourists in 2010, a year before Mubarak's overthrow and the ensuing economic nosedive.

Restoring even two thirds of that number is a key government goal, but it hinges on Russia and Britain resuming flights, Husseini said.

"There are ongoing negotiations... we hope the issue will be resolved as soon as possible," she said.

More than 60 per cent of tourists arriving in Sharm El Sheikh by plane used to come from Britain or Russia.

"So long as the Russians do not come back, there will be paralysis," Mohsen said. "Russians and Britons are the backbone of Sharm El Sheikh."

Other European countries such as Germany and France have registered a slight increase in reservations to Egypt.

In early February, four other European countries — Denmark, Finland, Norway and Sweden — eased travel warnings against travel to south Sinai, where Sharm El Sheikh and other resorts are situated.

CAIRO — Egypt's agricultural exporters are seeing a surge in demand and finding new foreign markets only months after the currency was floated, with many rushing to expand capacity to keep up.

Egypt's pound has roughly halved in value since the central bank abandoned its peg of 8.8 to the dollar on November 3, making Egyptian fruit and vegetables look cheap and attractive to foreign buyers, exporters said.

"Demand has doubled, with every product gaining one or two markets," said Mostafa Al Naggari, chairman of Fresh Fruit Co., which recently signed deals to ship to China and is finalising others with Australia, New Zealand and Korea.

The currency flotation helped Egypt to secure a $12 billion IMF loan to support a wide-ranging reform programme aimed at restoring foreign inflows and reining in the budget deficit.

A series of tax increases and subsidy cuts, along with the currency depreciation, have driven inflation to record levels in a country where millions live a pay cheque away from hunger. But amid the pain of government austerity, local manufacturers and exporters are reporting a pick up in activity.

Egyptian politicians have blamed the import-dependent country's ballooning trade deficit, which stood at $42.64 billion in 2016, for putting pressure on the pound. Along with a sharp reduction in imports, a rise in agricultural exports could help narrow that gap.

Exports of Egyptian vegetables, fruits and legumes amounted to $2.2 billion last year and would likely rise by about 15 per cent in 2017 as a result of the float, Abdel Hamid Al Demerdash, the head of Egypt's Agriculture Export Council, said.

The main vegetable exports include onions and artichokes, and fruits include oranges and strawberries.

The growing interest follows a turbulent year for Egyptian produce, with a Hepatitis A scare in North America linked to Egyptian strawberries and a temporary ban of Egyptian fruits and vegetables in Russia, one of Cairo's top buyers.

But traders say growth now comes down to how quickly they can expand to meet demand.

Japan Food Solutions (JFS), a fruit and vegetable exporter, is working to double its planted area this year to meet an expected 20-30 per cent increase in demand on the back of new orders from markets in Europe and North America, senior managing director Emad Said said.

"I see this as a golden opportunity for Egyptian produce to compete more aggressively ... The clever ones will seize this opportunity to enter new markets," he said.

PICO Modern Agriculture Co., another exporter, has seen its demand from Gulf Arab countries jump by about 50 per cent in the last two months, chief executive Alaa Diab said.

"The flotation has been very tempting and very helpful. It opened the eyes of many importers to come look at Egypt where they can get much more competitive deals," Diab said.

ATHENS — Greece said Thursday it intends to reach “a political agreement in principle” with its creditors on Monday, in order to unblock loans required by the cash-strapped country to repay its debts.

For months, Athens and its European and International Monetary Fund (IMF) lenders have failed to concur over the terms of the latest review of Greece’s 86 billion euro bailout.

Eurozone finance ministers meet on Monday in Brussels to discuss the deadlock with hopes that the different sides can at least achieve an outline of a deal. 

This is the aim of “all the stakeholders” in Greece’s recovery programme, government spokesman Dimtris Tzanakopoulos told a press conference.

“The political conditions are there for such an agreement,” he said.

A senior eurozone official in Brussels said that a broad sketch of a deal was the “best case scenario” for the ministerial talks on Monday.

This would allow the creditors to send teams to Athens in order to “crunch the numbers” and hammer out the final deal, the official said.

The row is centred on whether Greece can deliver on budget targets that the IMF says are based on overly-optimistic economic forecasts.

The eurozone has demanded that Greece deliver a primary balance, or budget surplus before debt repayments, of 3.5 per cent of GDP, but the IMF has said only 1.5 per cent is feasible.

The Washington-based fund insists more tax hikes and pension cuts are needed for Greece to meet its targets — something the leftist government in Athens flatly refuses.

A compromise is required to sign off on a second review of the bailout programme and unblock a tranche of loans Greece needs for debt repayments of seven billion euros this summer.

According to Tzanakopoulos, the challenge for Monday’s meeting is to “bridge the differences” in the post-2018 forecasts between Greece and Europe on the one hand and the IMF on the other.

European Commission Vice President Valdis Dombrovskis warned that “time lost in reaching an agreement will have a cost for everyone”.

“The agreement is within reach, provided that all sides show political will,” he told Greek economic portal Euro2day.

Top EU economics official Pierre Moscovici, considered an ally of Greece, visited Athens on Wednesday in a bid to end the standoff.

“We have a few key days, let’s concentrate now to finish all these talks. The parameters are on the table, everybody knows them,” he told reporters.