Greece to miss 2015 target

Greece will miss its revenue target from asset sales this year due to delays in a €1.2bn airport deal, the head of its privatisation agency said yesterday, in a setback to efforts to meet the terms of its new bailout.

As part of its commitments under the €86bn rescue loan from international creditors, Greece aims to raise €1.4bn from privatisations this year.

It has a patchy record of meeting such targets, and Stergios Pitsiorlas of the country’s privatisation agency HRADF said reaching the 2015 figure was also now “unfeasible”.

“On the other hand, I think it is realistic that we achieve the 2016 targets,” he told Reuters in an interview.

Greece aims to cash in €3.7bn from asset sales next year and €1.3bn in 2017.

At the end of last year it chose Germany’s Fraport and its Greek partner, energy firm Copelouzos, as the preferred bidder to operate 14 regional airports in tourist destinations, one of the biggest privatisations since the start of the debt crisis in 2009.

However, the agreement, along with others including the sale of 67% in its biggest ports, Piraeus and Thessaloniki, was halted soon after the leftist Syriza-led government came to power in January.

Although the sales are now back on track, Greece may not conclude the airport transaction on time to receive the €1.2bn from the deal by December, Pitsiorlas said.

Greece has raised about €3.5bn from asset sales since it signed its first bailout in 2010, when the privatisation fund was set up.

That is far below an original target of €50bn that has been progressively cut amid a lack of investor interest and political will.

Five governments have held office in Greece over the same period and Pitsiorlas is the fund’s sixth chairman.

He said he expected the Fraport deal to be concluded this year but it would take several months for the concession to start and Greece to receive the money.

“If Fraport is not ready to sign the contract early in October when its letter of guarantee expires, we could discuss a short extension,” Pitsiorlas said.

Fraport said in August it no longer expected the deal to be concluded this year.

Pitsiorlas said the agency’s board will meet today to approve a change in the terms of the tender for the privatisation of Thessaloniki port.

Investors will be asked to submit a bid for a 51% stake by February instead of the 67% originally put up for sale, with the option to acquire an extra 16%.