Saturday, February 21, 2015

Greece wins Eurozone agreement for conditional extension to bailout

Europe correspondent Mary Gearin, wires 21 February 2015

A Greek flag flies outside the headquarters of bank of Greece in central Athens.

Photo: An agreement removes the immediate risk of Greece running out of money next month (AFP: Aris Messinis)

Related Story: Germany rejects Greek proposal for loan extension

Related Story: Greece asks EU for six-month loan extension

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Map: Greece

An emergency meeting of Eurozone finance ministers in Brussels has agreed to a four-month extension of Greece's bailout, buying time for the cash-strapped nation.

Greece must produce a list of reforms by Monday to ensure the country complies with the conditions of the agreement with Euro group.

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

"This list will be further specified and then agreed with the institutions by the end of April."

An agreement removes the immediate risk of Greece running out of money next month and possibly being forced out of the single currency area.

It provides a breathing space for the new leftist-led Athens government to try to negotiate longer-term debt relief with its official creditors.

Officials said an outline deal was reached in preparatory talks involving the Greek and German finance ministers, as well as the managing director of the IMF.

It was then agreed by the full 19-member Euro group, ending weeks of uncertainty.

European Union paymaster Germany, Greece's biggest creditor, had demanded "significant improvements" in reform commitments by Athens before it would accept an extension of Eurozone funding.

With the 240 billion euro EU/IMF bailout program due to expire in little more than a week, prime minister Alexis Tsipras voiced confidence of an agreement despite the objections to the request made in a letter to Euro group head Jeroen Dijsselbloem.

"I feel certain that the Greek letter for a six-month extension of the loan agreement with the conditionalities that accompany it will be accepted," Mr Tsipras said in a statement to Reuters before the crucial Brussels meeting.

Officials said Greece's partners requested the shorter period.

A report by German magazine Der Spiegel that the European Central Bank was making contingency plans for a possible Greek exit from the currency area if the talks fail, on which the ECB declined comment, highlighted the high stakes.

German chancellor Angela Merkel earlier said all EU partners wanted to keep Greece in the euro but added: "There is a need for significant improvements in the substance of what is being discussed so that we can vote on it in the German Bundestag, for example next week."

The Greeks won sympathy from Italian prime minister Matteo Renzi.

"I believe that the principle of doing reforms in exchange for more time is just and correct," he said after a meeting of his government in Rome.


From other news sites:

Greece wins Eurozone agreement for conditional extension to bailout - ABC News (Australian Broadcasting Corporation)