The Minister of National Economy and Finance Kyriakos Pierrakakis, presided today, in his capacity as chairman of the Board of Governors of the European Stability Mechanism (ESM), at the meeting of the Organization’s Board of Directors.
It should be noted that, in his capacity as chairman of the Eurogroup, Mr. Pierrakakis is also ex officio chairman of the Board of Governors of the European Stability Mechanism (ESM), in which the finance ministers of the eurozone participate.
As stated by the ministry, the ESM is of particular importance to the financial architecture of the eurozone. It has supported five European countries and Greece, of which it is the largest official creditor. Under the third economic adjustment program (2015–2018), it granted Greece loans totaling 61.9 billion euros. Together with the loans from the European Financial Stability Facility (EFSF), the two European mechanisms currently hold more than half of Greece’s public debt.
The particularly favorable financing terms, the low interest rates and the very long repayment terms of these loans , have contributed decisively to the sustainability of Greek debt, the reduction of its servicing costs, and the country’s successful return to international markets. Without the contribution of the ESM and the EFSF, the picture of Greek public debt would be significantly more burdened today.
Below are the joint statements by Mr. Pierrakakis and the Managing Director of the ESM, Pierre Gramegna
Pierre Gramegna: Good morning, everyone. It’s a pleasure to see you all. Today marks the 14th annual meeting of the Board of Governors of the European Stability Mechanism (ESM), so it is always a great pleasure and honor to welcome the finance ministers representing their countries.
This year, we will focus, first and foremost, on the ESM’s exceptional results. Our profits this year will approach 2 billion euros, the highest amount in our history. This strengthens our resilience.
We will also examine how we can ensure our readiness to face any potential crisis, while assessing the preventive measures and tools at our disposal. This is exactly what Member States expect from us.
Last but not least, today we will warmly welcome Bulgaria as a new member of the European Stability Mechanism. Bulgaria joined the eurozone in January of this year and is expected to become a full member of the ESM in June, which essentially serves as a safety net that a country acquires when it adopts the euro—something Bulgaria has achieved.
And today I have the great pleasure of welcoming for the first time, in his new capacity as Chairman of the Board of Governors of the ESM, Mr. Kyriakos Pierrakakis, to whom I now give the floor.
Kyriakos Pierrakakis: Thank you very much, Pier. It is a great pleasure for me to be here today at the ESM, in my new capacity as Chair of the Board of Governors of the European Stability Mechanism.
I fully agree with the assessment you just made and with your overall overview of today’s discussions. The ESM was established during a very difficult period for Europe, in the midst of the European public debt crisis , playing a decisive role in enabling Europe and its member states to emerge from that crisis through a new institutional framework and the strengthening of European capabilities.
Today we are facing a changing geopolitical and economic environment. Conditions are constantly changing, and our common goal is for the ESM to remain strong, credible, and capable of responding to the challenges facing Europe.
I believe that for the country I come from, Greece, the ESM has played a particularly important role. It is part of its difficult but successful path to recovery. And I believe that Greece exemplifies in a very characteristic way what can be achieved when European support meets national determination to overcome a crisis. There are many lessons to be drawn from this experience, but also a very powerful symbolism.
I look forward to today’s discussions and consultations, as well as to the meeting that will follow.
Journalist’s question: How can the ESM be considered credible when a major country like Italy has not yet ratified the revised ESM Treaty?
Kyriakos Pierrakakis: The ratification process is obviously a sovereign decision of the Italian government and the Italian parliament. From our perspective, I would say that overall this is a missed opportunity.
There is already an existing institutional framework in place that allows the ESM to fulfill its role and carry out its important work. After all, we are here precisely to discuss this issue and examine how the ESM will continue to fulfill this role both in the current environment and in the years to come.
