German Finance Minister Wolfgang Schaeuble, left, and the Finance Minister of Greece, Yanis Varoufakis, right, shake hands after their press conference German Finance Minister Wolfgang Schaeuble, left, and the Finance Minister of Greece, Yanis Varoufakis, right, shake hands after their press conference

Extension in loan by 4 months par bailout - Greece

Written by  Published by:Pakistan Views Saturday, 21 February 2015 08:18

Eurozone finance ministers (Eurogroup) and the International Monetary Fund (IMF) have, in principle, extended Greece's Bailout Loan by four months and its creditors have.

The agreement, which will be ratified once the country presents a list of reforms by Monday as required by its creditors, was reached during preparatory talks between Greek Finance Minister Yanis Varoufakis, German Finance Minister Wolfgang Schaeuble, IMF chief Christine Lagarde, and Eurogroup chairman Jeroen Dijsselbloem on Brussels on Friday night.

The accord was agreed upon by all of the 19 members of Eurogroup after the initial talks.

"It has been a laborious but eventually a constructive process," Lagarde said.

The agreement removes the immediate risk of the debt-ridden country running out of money over the next month, and its possible exit from the eurozone.

It also gives the new government in Athens a breathing space in which it can carry on negotiating a longer-term debt relief plan with its international creditors.

Greece had reiterated its promise to honor all debt in a timely fashion, said Dijsselbloem.

"Tonight was a first step in this process of rebuilding trust," Dijsselbloem, said at a news conference after the meeting. "We have established common ground again to reach agreement on this statement."

“It was intense because it was about building trust between us,” he added. “Tonight was a first step in this process of rebuilding trust. As you know, trust leaves quicker than it comes.”

Deal conditions

According to eurozone officials, the deal requires Greece to present a letter by Monday, listing all planned policy measures it will use during the remainder of the bailout period to make sure they comply with reform conditions.  

"The institutions will provide a first view whether this is sufficiently comprehensive to be a valid starting point for a successful conclusion of the (bailout) review," the Eurogroup said in a joint statement.

The government of Greek Prime Minister Alexis Tsipras, whose leftist Syriza party stormed to victory in elections on January 25, has tried to renegotiate the terms of the country’s €240-billion (USD 270 billion) bailout it received in 2010 in return for imposing harsh austerity measures.

During his electoral campaign, Tsipras vowed to reconsider the austerity measures that have caused mounting dissatisfaction in the country.

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