Greeks must reap benefits after their sacrifices, says EU's Mosovici - as it happened
Greece is now able to raise money in markets after a289bn bailout ends
1.53pm BST
Greece has turned the page to become "a normal" member of the single currency, European Union authorities in Brussels declared as the country finally exited its eight-year bailout programm, writes Jennifer Rankin.
Its three bailouts during the eurozone crisis totalled a288.7bn (258bn) - the world's biggest-ever financial rescue. During that time, as the crisis that threatened to lead to the nation's ejection from the single currency - "Grexit" - Greece has had four governments and endured one of the worst recessions in economic history.
Marking the official end of the third bailout programme on Monday, Pierre Moscovici, the European commissioner for economic and financial affairs, said Greece was beginning a new chapter after eight "very difficult" years.
Related: EU says Greece can 'finally turn the page' as bailout ends
1.28pm BST
The Turkish lira continues to come under pressure, now down 1.66%. Kathleen Brooks, research director at Capital Index, says:
Germany may say no now, but it is becoming increasingly likely that Turkey will need significant amounts of financial aid in the months to come. Qatar has come in with a credit line to backstop the economy, and has promised $15bn of investment in Turkey. However, this has not been able to stabilise the lira at the start of the week, which has suffered another rout today.
The problem for investors is two-fold: firstly, Moody's and S&P, the credit rating agencies, cut Turkey's debt to junk status at the end of last week, which limits the amount of sovereign debt larger investors like pension funds can purchase, it could also make a bailout by the likes of Germany less likely.
1.15pm BST
Meanwhile in Athens it has not gone unnoticed that Prime Minister Alexis Tsipras has chosen to remain silent about Greece's much-awaited bailout exit, writes Helena Smith from Athens. His only public utterance today has been to tweet his congratulations to the county's youth water polo team on its world championship victory.
Has this got something to do, perhaps, with the fact that his leftist-led government has signed up to a staggering array of ambitious targets? Post-bailout Greece has committed to produce primary surpluses of 3.5 % of GDP until 2022 - a feat achieved by only a handful of countries since the seventies - and 2.2 % until 2060.
12.56pm BST
The chief economist of the ESM rescue fund has admitted there were mistakes made with Greece.
In an interview with CNBC Rolf Strauch said:
This was a severe crisis situation and obviously it's difficult to claim that everything went well in the sense that everything was completely right at the time. I think the overall direction of the programme was right and what we're seeing now, are particularly the consequences of those many reforms that were taken, and it's true that also the Greek people deserve a lot of respect for what they did over the years. Reforms have the feature that it takes a bit until you see the impact and so the benefits of the reforms weren't occurring right at the start or right from the moment when they were taken, but they are coming in now and I think this process will continue. You should see the projected growth rates, they are about 2%. This is good news, the task is now to stay on course and reap the benefits of what was done in the past.
Obviously, it takes a lot to restructure an economy, and therefore [Greece has agreed] the steps to be taken by the Greek authorities in the coming years and they have made some commitments on that.
#ESM Chief Economist Rolf #Strauch speaks to @SquawkCNBC about end of Greece's programme; read transcript of interview https://t.co/49lMaLuqh8 @GeoffCutmore @cnbcKaren pic.twitter.com/vzTDL2dRxv
12.14pm BST
The head of the European Stability Mechanism, the euro zone's bailout fund, has wasted no time stressing the point that the debt-Stricken country will be subject to a strict regime of enhanced surveillance post-bailout, reports Helena Smith from Athens:
Speaking to the Greek daily Ethnos this morning Klaus Regling, the rescue fund chief, emphasized that Athens will be strictly monitored in the coming years so there is no let up in reform implementation.
"Greece is exceptional. It has received much more loans from us than any other country," he told the paper, saying that Athens unlike any other member state had also benefited from " huge amounts of debt relief."
Related: Has Greece finally escaped the grip of catastrophe?
11.49am BST
And Greece will also continue to be monitored:
European Commission, @ecb, @ESM_Press and @IMFNews will come back to #Greece on 10 September to monitor progress and discuss 2019 draft budget @EU_Commission @pierremoscovici
In Greece conclusion of bailout doesn't imply end of policy conditionality - in September European Commission will visit country to go through 2019 budget - meanwhile ESM, ECB and IMF will conduct first post-programme assessment, which will condition future access to markets
11.35am BST
On the other hand, Greece still faces serious challenges, according to Joan Hoey, director for Europe at The Economist Intelligence Unit:
There has been lots of pain, but to what gain, and to what purpose has the Greek government signed up to multi-decade, large primary budget surplus targets which are likely to hobble growth?
The economy has been in almost permanent recession since 2010, and real GDP has shrunk by more than a quarter from its pre-crisis peak in 2007-08. Unemployment is still about 20%, and youth unemployment is more than double that. Despite undertaking the biggest post-crisis fiscal adjustment of any euro zone country, Greece's public debt is equal to about 180% of GDP. ESM fiscal and structural reform policies, to which Greece will remain subject after the third economic adjustment programme expires, are unlikely to generate sufficient economic growth to mitigate the country's debt burden or reduce popular disaffection. Grexit is not a short-term risk, but Greece will struggle to improve competitiveness inside the euro area or grow its way out of its huge debt burden (179.1% of GDP in 2017), so it will remain a significant risk over the medium and long term.
11.27am BST
The austerity measures undertaken by Greece will lead to a sustainable recovery, says European economics commissioner Pierre Moscovici.
Speaking as the country exits its bailout programme, he said:
The extensive reforms Greece has carried out have laid the ground for a sustainable recovery: this must be nurtured and maintained to enable the Greek people to reap the benefits of their efforts and sacrifices.
EU's Moscovici Says Greece Must Ensure Continued Implementation Of Reforms
EU's Moscovici Says Greek Economic Growth Expected To Remain Around 2Pct In 2018, 2019
11.19am BST
Back with Greece, and here is a link to the European summary of the main statistics:
The conclusion of Greece's stability support programme opens the door to a new chapter for Greece. See here for key facts and figures: https://t.co/0d2nhW2Sk8
11.11am BST
Here's our story on the tensions between Turkey and the US:
Related: Shots fired at US embassy in Turkey
11.01am BST
President Tayyip Erdogan has been speaking again about the crisis which has laid low Turkey's currency and prompted a market sell-off. Reuters reports:
[Erdogan] said on Monday an attack on Turkey's economy was no different from a strike against its flag or the Islamic call to prayer, responding to a recent currency sell-off in stark religious and nationalist terms ahead of a major Muslim holiday.
In a pre-recorded address to mark the four-day Eid al-Adha festival, which starts on Tuesday, a defiant Erdogan said the aim of the currency crisis was to bring "Turkey and its people to their knees".
Amid the tension, several gunshots were fired on Monday from a vehicle at the U.S. Embassy in the Turkish capital. Nobody was hurt.
"The attack on our economy has absolutely no difference from attacks on our call to prayer and our flag. The goal is the same. The goal is to bring Turkey and the Turkish people to their knees - to take it prisoner," Erdogan said in the televised address.
German Govt Spokesman Says It Is Up To Turkey To Decide Whether It Wants To Ask IMF For Help
German Gov't Spokesman Says Possible Financial Aid For Turkey Will Not Be At Centre Of Talks With Turkish Leaders
10.32am BST
Markets are continuing to head higher, as investors shrug off the continuing concerns about Turkey and concentrate on the prospects for US-China trade talks.
The FTSE 100 is up 0.55%, while Germany's Dax has added 0.93% and France's Cac has climbed 0.63%. Joshua Mahony, market analyst at IG, said:
The fears of last week seem to have been washed away with a renewed optimism over the direction of US-China trade. Markets often find it difficult to focus on one topic, and thus with the focus now shifting away from Turkey and towards China, it comes as no surprise that the pessimism of last week is fading into obscurity.
9.25am BST
As Greece exits its bailout, new government figures show a drop in the country's current account surplus compared to a year ago, but a rise in tourist revenues. Reuters reports:
Greece's current account balance showed a smaller surplus in June compared to the same month a year earlier on the back of a wider trade deficit, the Bank of Greece said on Monday.
Central bank data showed the surplus fell to 210 million euros ($240.18 million) from a surplus of 737 million euros in June 2017. Tourism revenues increased to 2.33 billion euros from 2.007 billion in the same month a year earlier.
"In June the current account ... (was) down by 527 million euros year-on-year, as a result of a deterioration principally in the balance of goods and to a lesser extent in the primary income account," the Bank of Greece said.
It said the trade gap rose by 535 million euros as imports outstripped exports, mainly the result of a worsening in the oil balance.
#Greece central government debt +a1.64 bln QoQ to a345.38 bln at end-June from a343.74 bln at end-March (MoF). #economy
9.07am BST
And another reality check:
It's official! #Greece's tragedy is 'over' as its bailouts end. But #GDP still 25% smaller than before the start of the financial crisis! pic.twitter.com/iuDnh4XoAi
8.55am BST
Here's more on the forthcoming press conference on Greece:
Today, #Greece concludes its ESM stability support programme & @pierremoscovici will commemorate this important moment during a press conference today at 12:00 CET.
iWatch live via @EC_AVService https://t.co/iNYlxHwPOk pic.twitter.com/KdxGLBbimg
8.47am BST
Back in the UK, and luxury handbag marker Mulberry has seen its shares slump 26% after it warned it would take a 3m hit from House of Fraser's administration. Our full report is here:
Related: Mulberry warns House of Fraser collapse will damage profits
Related: MoJ seizes control of Birmingham prison from G4S
8.37am BST
Over in Turkey and the lira has edged lower again, down 1.4% at 6.09 against the dollar. But this is a far cry from its all time worst level against the US currency of 7.24 which it hit at the start of last week as economic crisis unfolded.
But the strain between Turkey and the US over the detention of a US pastor can be seen by the firing of gun shots at the American embassy in Ankara earlier this morning.
8.33am BST
Jamie McGeever at Reuters has a few sobering facts as Greece "returns to normal":
As Greece exits international bailout programmes, it's worth remembering:
- 500k people, mostly young, emigrated
- Unemployment hit 27.8% (still >20%)
- Youth unemployment reached 60%
- Economy shrank by 25%
- Debt/GDP ballooned to 180%
- Suicide & depression rates rose sharply
8.21am BST
Markets in Europe are marginally better as traders return to their desks after the weekend break.
The FTSE 100 is up 0.33%, France's Cac has climbed 0.32% and Germany's Dax is 0.34% better.
8.00am BST
Today Greece returns to normal, according to Portugal's finance minister and head of the eurogroup:
#Greece is now in a position where it can enjoy the full extent of aA membership, abiding by same rules as every other #euro country. In that sense, Greece today returns to normal. So welcome back. Video-statement: https://t.co/W4tiHtPgzO pic.twitter.com/6HGBo735dg
7.58am BST
Giorgos Papakonstantinou, who was finance minister when Greece signed up to the bailout, said he would do the same again if the country was in the same position.
He told the BBC's Wake up to Money programme:
The choice we had at that point was either to allow the country to go bankrupt by not paying our debts... at which point we would not have been able to pay salaries and pensions and provide basic public services.
Or to sign a bailout which would give us time to reduce those deficits.
Unfortunately I give a high probability that Greece will enter a new crisis three to five years from now, partly because Greece still has a very high level of debt and it has to repay a lot in the near term.
If Greece's growth slows down long-term, then markets might become very nervous and Greece will enter a new crisis.
7.53am BST
European markets are expected to make a mixed start to the week:
European Opening Calls:#FTSE 7555 -0.05%#DAX 12233 +0.18%#CAC 5355 +0.18%#MIB 20370 -0.22%#IBEX 9425 +0.08%
7.52am BST
Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.
It's a momentous day for Greece and its government led by prime minister Alexis Tsipras. After eight years and innumerable late night eurozone crisis meetings, the country is exiting its bailout programme. The so-called troika of creditors - the European Union, the European Central Bank and the International Monetary Fund loaned Greece a total of a289bn in three tranches in 2010, 2012 and 2015.
Related: Greece emerges from eurozone bailout after years of austerity
It is a tale of incompetence, of dogma, of needless delay and of the interests of banks being put before the needs of people. And there will be long-term consequences. When Greece first received help in 2010, the plan was for it to have access to the financial markets within two years. It has taken two further rescue packages and six years for that to happen.
Related: Greece's bailout is finally at an end - but has been a failure | Larry Elliott
The slump in the Turkish lira is on traders' minds as the fear of contagion into the eurozone is likely to remain a dominant theme. It was reported that emerging market funds were already trimming their exposure to the country in July, and that was even before the severe decline in the lira. Over the weekend, the central banks of Qatar and Turkey signed a currency swap agreement, and this follows on from the $15 billion that the gulf state pledged to invest in the country. Dealers are still scared that banks that have lent money to Turkish finance houses could face defaults, and it is possible we might see an increase in non-performing loans in the Turkish banking system, and that could seep into the eurozone.
Turkish markets are closed this week, which means volumes will be particularly low, therefore big swigs could be expected potentially unnerving traders once again.
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