New agreement on Greek debt

New agreement on Greek debt

The finance ministers of the 19 European Union countries reached the compromise after a day of marathon talks in Luxembourg early on June 22.

The ministers needed to finalise a deal between Greece and its worldwide creditors that would allow it to safely emerge from its third and final bailout program on August 20 and face the markets again.

"It is a deal which reflects the moral duty of our partners in response to the sacrifices of Greek people over the past eight years, so that the euro zone remains undivided", Greek Prime Minister Alexis Tsipras said during a meeting here with President Prokopis Pavlopoulos to formally brief him on the outcome of Thursday's talks in Luxembourg.

The creditors also agreed to a final disbursement of €15 billion, aimed to help Greece repay arrears, finance maturing debt and build up a cash buffer of €24.1 billion that will help it access financial markets. Over those years, Greece twice got perilously close to being kicked out of the eurogroup, EU Commissioner Pierre Moscovici said. "We believe the debt is now sustainable and we will be able to tap markets". "It is a historic moment".

"We are very close to the moment when we will reap the fruits of years of sacrifices and hard efforts by the Greek people", he said.

"Mooted debt relief measures only push the problem further into the future and Greece will remain vulnerable to a renewed downturn in its own economy or a flare-up in market fears about the euro-zone more generally", Capital Economics, a research firm, said in a note.

German chancellor says migration meeting a 'first exchange'
Italy and Malta refused to take in the ship which was stranded at sea for days before being offered safe haven in Spain . The Libyan navy said five people died and almost 200 were rescued off its coast while trying to cross the Mediterranean.

Under German demands, Greece's debt relief in the short-term will be conditional on the continued implementation of agreed reforms, which if successful could inject about one billion euros to the government's underfunded budget every year.

Greece has already received 275 billion euros ($320 billion) in financial support from the European Union over the past eight years.

To make a deal possible, Greek politicians last week pushed through a last batch of economic reforms required by the creditors, including pension cuts to health care and tax reforms.

Greece's ability to finance itself after the end of its third bailout was a key concern.

Sorras faces charges of defrauding the state by urging nonpayment of taxes, running a criminal organization, money laundering, spreading false rumors and incitement.

Related Articles