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Greece could return to debt markets soon: opposition leader Mitsotakis
May 15, 2017 / 8:28 PM / 3 months ago

Greece could return to debt markets soon: opposition leader Mitsotakis

Leader of conservative New Democracy party Kyriakos Mitsotakis looks on before a political leaders meeting at the Presidential Palace in Athens, Greece, March 4, 2016.Alkis Konstantinidis

LONDON (Reuters) - Greece could soon return to debt markets, marking a major step in its recovery from a prolonged debt crisis, opposition leader Kyriakos Mitsotakis, whose conservative party holds a double-digit lead in opinion polls, said on Monday.

"Returning to debt markets is a fundamental goal," he told a question and answer session at the London School of Economics.

"We may be able to tap capital markets in a protected manner. Assuming we have some visibility on the debt side, assuming we get QE, this could happen within the next months."

The deputy managing director of the euro zone's bailout fund said last week that Greece could return to debt markets "much before" mid-2018.

Mitsotakis, leader of the New Democracy party, who has been calling for a snap election, said he did not believe Prime Minister Alexis Tsipras' government enjoyed sufficient investor confidence to allow Greece to borrow at reasonable costs.

"We will need to borrow 10 billion euros in 2018-19, and will we have restored the level of credibility to borrow at reasonable interest rates? The jury is still out on that," he said. "I have my doubts that the current government can restore the confidence to get capital markets to support this."

Greeks are not due to vote until 2019.

Greece agreed a package of reforms with its lenders on May 2, after six months of haggling, paving the way for the disbursement of further funds and possibly opening the door to a reworking of its massive debt.

Opposition leaders criticized the agreement, which committed Greece to fiscal reforms, cutting pensions in 2019 and cutting the tax-free threshold in 2020.

"We are faced with a very heavy austerity package which to our mind is completely unnecessary," said Mitsotakis. "My fear is that the more time we lose, the more we pretend we are reforming, the more damage will be done ... on the economic front."

Greece's economy shrank in the first quarter.

The opposition leader repeated his criticism of Tsipras' pledge to produce a primary surplus of 3.5 percent, adding: "As long as the government is not committed to real reforms, we will be asked for more fiscal austerity."

He said he would cut the public sector by outsourcing more to private companies and pledged tax breaks and other measures to encourage new businesses and attract investment.

"In spite of the pain, suffering, anger (in Greece), people understand growth is only going to come from the private sector, that we need investment," Mitsotakis said.

Editing by Catherine Evans

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