Greece’s government is getting advice from an analyst who is also helping Iceland figure out how to end capital controls — a crucial issue that will face Greek banks and companies when controls are lifted, possibly later this year.
Germany’s Welt am Sonntag newspaper reported that Glenn Kim, 52, who spent two decades as an executive at failed American investment bank Lehman Brothers, has been working in the government’s Maximos Mansion in Athens as an advisor to Greek Finance Minister Euclid Tsakalotos.
“Am at Maximos, helping Euclid,” Kim texted a reporter from the newspaper last Tuesday before walking back an offer to answer questions about his role within the government.
Kim reportedly played a crucial role in the July 13 European summit that paved the way for the country’s €86 billion bailout, approved on Friday by eurozone finance ministers and the Greek Parliament.
Summit participants told the newspaper that Kim was involved directly in negotiations with German Chancellor Angela Merkel and Council President Donald Tusk, especially over the requirement in the third rescue package that Greece commit to set up a fund for the targeted €50 billion from privatizations.
This was one of the most fraught items in the negotiations, with German Finance Minister Wolfgang Schäuble initially pushed for the fund to be based outside Greece and preferably in Luxembourg, which Greek Prime Minister Alexis Tsipras rejected outright.
According to the Welt am Sonntag report, Kim was previously an adviser to the German Finance Agency, which manages German public debt, on issues connected to the European Financial Stability Facility and the European Stability Mechanism, the bailout funds created during the crisis.
The German government told the newspaper it was not familiar with the name Glenn Kim. The Greek government declined to comment on the report of Kim’s role.
Kim’s LinkedIn profile mentions that he also works as an adviser to the Icelandic Ministry of Finance and Economic Affairs on aspects of capital controls which are to be wound up “without threatening the economic stability of the nation.”
Greece imposed capital controls in June, after the collapse of talks with its creditors led to a flood of panicked withdrawals from Greek banks — more than €40 billion left the banks this year — creating the danger of an implosion of the financial sector.
It is almost impossible for Greek citizens to transfer money out of the country, and companies have to obtain permission from a government commission for transactions larger than €100,000.
As part of the bailout agreement, €10 billion will be set aside next week to help recapitalize Greek banks. But it may take some time to rebuild confidence in the banks to the point where capital controls can be lifted. Cyprus took two years to lift capital controls imposed during the crisis of 2013. Iceland, which imposed capital controls in 2008, is only now starting to lift them.