Greece gets warnings from creditors, now comes hard part

By Marcus Bensasson & Nikos Chrysoloras

One phrase echoed from Brussels to Frankfurt and Washington as Greece?s creditors examined and then waved through the country?s new economic policies: ?starting point.?

While the month-old government in Athens was praised for coming up with a workable package of measures including maintaining state-asset sales and collecting more tax, the European Commission, European Central Bank and International Monetary Fund all warned that action speaks louder than words.

?The conditional agreement to extend the current program is just the first hurdle in a long race,? Maria Paola Toschi, global market strategist at JPMorgan Asset Management, wrote in a note to clients on Tuesday. ?We expect the negotiation process to continue to blow hot and cold.?

The measures were a condition for extending the availability of bailout funds for another four months based on an initial agreement on Feb. 20. While their approval on Tuesday marked another compromise in Greece?s five-year financial crisis for the euro region, the country finds itself in all too familiar territory: act or face insolvency.

The list is ?not very specific? and doesn?t convey ?clear assurances? that reforms will happen, IMF Managing Director Christine Lagarde wrote in a letter to the head of the euro region?s group of finance ministers. Commission officials and ECB President Mario Draghi also said the key to Greece winning more funding were ?commitments? on legislation.

April deadline

The current program, which has been keeping Europe?s most indebted state afloat since 2010, was scheduled to expire at the end of this month. After almost four weeks of negotiations, all parties stepped back from the brink, with Prime Minister...