##es. last year, the primary surplus was 4. 2 % of gdp, outperforming the target of 0. 5 %. the current account during the last two years had effectively been in balance from a 15 % deficit eight years ago. at the same time, sweeping structural reforms have been implemented, covering the pensions system, the health system, labour markets, product markets, the business environment, public administration, etc. recapitalisation and restructuring have taken place in the banking system and significant institutional reforms have been initiated aiming at reducing the volume of npls. moreover, there is evidence that the economy has been undergoing a rebalancing towards tradable, export - oriented sector : the share of exports of goods and services in gdp increased from 19 % in 2009 to 28. 2 % in 2016, with most of the increase coming from exports of goods. 2. 3 recent economic and financial developments see appendix for an update on the macroeconomy and the banking sector. 3. bog proposal - a mild debt relief exercise see appendix for details. 4. major pending issues two quotes from the latest eurogroup statement ( 15. 06. 2017 ) : i ) “ the eurogroup stands ready to implement, without prejudice to the final dsa, extensions of the weighted average maturities ( wam ) and a further deferral of efsf interest and amortization by between 0 and 15 years. as agreed in may 2016, these measures shall not lead to additional costs for other beneficiary member states ”. ii ) “ in view of the ending of the current programme in august 2018, the eurogroup commits to 2 / 4 bis central bankers'speeches provide support for greece ’ s return to the market : the eurogroup agrees that future disbursements should cater not only for the need to clear arrears, but also to further build up cash buffers to support investor's confidence and facilitate market access ”. 4. 1 getting greece into qe the person speaking before you was the first greek economist to talk about the modalities and the benefits of getting greece into ecb ’ s qe programme, in october 2015 talking to international investors in new york, and the programme – let me remind you that the qe programme started in march 2015. president draghi, when asked about the eventuality of greece ’ s participation in the ecb ’ s qe programme [ on many occasions in fact, right after many governing

council press conferences with q & as, but also at his regular hearings before the european parliament ( his last hearing was on the 29th of may before your committee ), if i am not mistaken, he was also asked on this by vice - president papadimoulis ], gave two preconditions : 1. the full completion of the second review and stick with the implementation of the programme, and 2. a dsa report by the ecb itself. of course, the last precondition depends on the imf ’ s role and report due on the 27th of july ( next month ) ( rumours say that this will be delayed after the german elections in september ). however, we have something in our hands : the last eurogroup statement, which sets out a roadmap for this, not very much in detail, but it is a step forward compared with the decisions taken on 25 may 2016. i expect – sooner or later – perhaps sometime after the german elections, there is still time, that some sort of debt relief will be given to my country, along the lines of the eurogroup statement of 15 june ( “ extension of maturities between 0 and 15 years ” ), here at the bank of greece, i just gave you the cut - off figure, 8. 5 years according to our own dsa, which makes our debt sustainable and will be an enormous help for ecb president draghi. in terms of timing, when could all this happen, given that the qe programme officially ends in december this year? the crucial parameter here is ‘ tapering ’, which means that for the first six months or perhaps more in 2018, the ecb will keep buying government bonds, but at a diminishing rate ( from €60, to €50, to €40 billion, etc. ) and during this period, it could – provided that the above preconditions are met – include ggbs. why is it so important, you may say, to get greece into qe? for one simple reason : because it is going to affect the cost of sovereign borrowing on capital markets. it is not so much the real demand issue, this is going to be around €3 - 4 billion, but it is the signalling effect that it is included in draghi ’ s umbrella and the best evidence for what i am saying is the next figure ( see page 18 ) that shows the powerful impact of signalling. [ as you know, ] the