New Greek bailout deal ‘agreed in principle’
Print Edition
THE European Commission said yesterday that Greece has reached a technical agreement “in principle” with its international creditors on a third debt bailout.
“What we don’t have is a political agreement,” said Commission spokeswoman Annika Breidthardt, hours after Athens suggested that the deal was all but done.
Hammered out after marathon talks in Athens stretching into the early hours of yesterday, the accord comes with financing of 85 billion euros (US$94 billion), the Greek government said.
Breidthardt said the Economic and Financial Committee, which coordinates EU-wide economic policy, would make a conference call to all 28 member states to enable them “to take stock” of the deal.
Greece and its creditors — the EU, the European Central Bank, the eurozone bailout fund and the International Monetary Fund — are hoping to finalize the deal by August 20, when Athens must repay about 3.4 billion euros to the ECB.
Both sides said details remained to be hammered out, but Athens was planning to submit it to parliament later in the day. The chamber is expected to vote on the accord tomorrow, and eurozone finance ministers could be asked to approve it the next day.
A finance ministry source said the remaining details “do not affect the main body of the agreement.”
The Athens stock market rose 1.4 percent on the news.
State broadcaster ERT yesterday said Prime Minister Alexis Tsipras had spoken to German Chancellor Angela Merkel, French President Francois Hollande, EC chief Jean-Claude Juncker and European Parliament Chairman Martin Schultz about the accord.
Athens has committed to a primary deficit of 0.25 percent of output in 2015, and a surplus in 2016, meaning no new fiscal measures will be necessary until then, the source said.
Next year, the primary surplus will be 0.5 percent, followed by 1.75 percent in 2017 and 3.5 percent in 2018, the source said.
The Greek government said its creditors agreed to a “mild adjustment” on fiscal targets that will help foster growth and save about 20 billion euros compared with measures promised by the previous administration.
It added that Greek banks would immediately receive 10 billion euros from the package, and will be fully recapitalized by the end of the year.
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