Greece, Eurogroup: agreement on strain of debt – The Republic

The Eurogroup gives the go ahead for the new aid to Greece and reaches a maximum compromise that (from 2018 as called for Germany) will cut the debt of Athens. The agreement came in the night after almost 12 hours of negotiations. The former Troika will ensure the government of Alexis Tsipras 10.3 billion of aid in two installments, the first in June of 7.8 billion, the second probably after the summer. The ESM on the other hand, the European Stability Fund, will study a short, medium and long term plan “to be introduced gradually” intended to reduce the exposure burden (311 billion) in Athens. No immediate cut, therefore, and no promise of amnesty on future payments. But the commitment to reduce the burden on the debt service (see the interest you pay) to less than 15% of GDP in the medium term, and less than 20% in the long term. A solution a bit ‘dilatory and a far cry from the IMF demands that sought to block payments until 2040, but enough to convince representatives dell’Fondo them to give the go ahead to the agreement, proposing to the Washington board not to slip off from the bailout.
“mutual trust after the approval of the new measures by the Greek government has allowed us to open a new phase,” said Eurogroup President Jeroen Dijsselbleom. “We are at a turning point that allows us to break the vicious cycle recession-cuts-recession and reopen the era of foreign investment in the country,” said Minister of prudent finance greek Euclid Tsakalotos. Poul Thomsen, the IMF’s representative in Europe, has denied having made major concessions by meeting with German Chancellor Angela Merkel. “In my opinion the solution reached is to meet our objectives of reducing the exposure of the medium-term Greece greatly – he pointed out – although now it is up to the board of the Fund to give the go-ahead later this year to the participation of the third bailout of Greece in exchange for aid epr 86 billion. “
No comment instead for now from Berlin, who – along with Alexis Tsipras – is perhaps the real winner of the negotiations. The German Economy Minister Wolfgang Schaeuble had said before entering the Brussels summit did not want to make decisions on the Greek debt until 2018, not to make electoral gifts to the German nationalist right. It brought the result home. “He ‘been a difficult night but fine so it went well,” said Peter Kazimir, the Minister of Finance of the Slovak representative in front of the ever tender hawks with Athens. “The choices tonight are above all a sign of confidence in Greece,” he concluded his French counterpart Michel Sapin.

The way to bring the country out of the crisis is still long. Good part of the new aid, as always happened, will return almost on the spot in his pocket to creditors to repay their loans in the past. But it is true that the danger of Grexit today is a bit ‘farther and that the Syriza government, after a year and a half complicated, back in the Parthenon with real hope to have almost closed blacks six years of austerity and crisis .

The greek debt holders

Topics:

Greece

Eurogroup

IMF

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