DURING last night’s Euro zone finance ministers and the International Monetary Fund (IMF) talks in Brussels, European leaders clinched agreement to a deal that will allow Greece to get almost 44 billion more Euros in 3 tranches.
“Greece has shown that it is serious about reform” and has kept to its commitments, European Commissioner for Monetary Affairs Olli Rehn said at a news conference after the meeting.
“Greece has already come a very, very long way,” Rehn said.
According to the Eurogroup statement, the parties believe that the “necessary elements are now in place” for member states to approve a European Financial Stability Facility (EFSF) disbursement to Greece of €43.7 billion ($56.8 billion) in several tranches, with the formal go-ahead seen by Dec. 13 — a date which BNP Paribas noted was one day ahead of a round of key Greek treasury-bill redemptions.
We summarize in bullets about “Greece New Deal”:
– Goal is to get Greek debt down to 122% of GDP in 2020.
– Greece gets more breathing space, goal of 4.5 percent of Gross domestic product (GDP) primary surplus is postponed from 2014 to 2016.
– Greek loan rates are lowered by 100 basis points.
– Cutting guarantee costs for Greece’s EFSF loans by 10 basis points.
– Maturity on loans extended by 15 years (reducing payments).
– Lower EFSF fee.
– Public debt tender purchases of Greek sovereign debt may also take place
– Other countries to forgo profits on Greek debt that has been purchased by the ECB.
– Greece may do a debt buyback.
– Possibly deferring interest payments on EFSF loans by 10 years.
“All initiatives decided upon today will bring Greece’s public debt clearly back on a sustainable path,” Luxembourg Prime Minister Jean-Claude Juncker told reporters after chairing a meeting that ended early today. “This has been a very difficult deal.”
Euro region finance ministers persuaded a skeptical International Monetary Fund that Europe has a formula for rescuing the country that triggered the debt crisis.
Latest posts by Steve Gavriliuc (see all)
- Taiwanese Billionaire Banker, Tsai Wan-tsai, Fubon Group Founder Dies - October 6, 2014
- A Russian Billionaire Spends £2 million At A Private Nightclub In Mayfair In Just 3 Hours - October 2, 2014
- China will surpass the United States as the largest business travel market in the world in 2015 - July 28, 2014