Second Greek Bailout: Almost Done!

Eurozone finance ministers are leaning towards approving the new $171-billion bailout for Greece. The second bailout for debt-laden country would resolve Athens’ immediate repayment needs but seems unlikely to revive the nation’s shattered economy.

French Finance Minister Francois Baroin said Monday that after months of negotiations over terms of the deal for debt-ridden Greece, an agreement is in sight for the country’s second bailout in two years.
“We have all the elements for an agreement. From now on, the elements of a voluntary participation of the banks, of the private creditors and of the public creditors – the states, the central banks – are fully in place.”
U.S. Treasury Secretary Timothy Geithner said Sunday Greece has adopted a very strong and difficult package of reforms that deserves the international community’s support. He said the United States encourages the International Monetary Fund to support the loan for Greece.
The Greek government has approved austerity measures that include a 22-percent cut in the country’s minimum wage and the elimination of 15,000 government jobs. Greece said without the bailout, it would not be able to pay investors $19 billion in debt when government bonds come due next month.
The government is also nearing completion of negotiations to at least cut in half the debt it owes private creditors – a $131-billion reduction.
As the meeting of the finance chiefs started in Brussels, Dutch Finance Minister Jan Kees De Jager said he remained unconvinced Greece could meet its austerity commitments. He called for an unprecedented permanent presence in Athens for Greece’s international creditors to oversee the country’s spending.
Analysts have warned that if Greece defaulted next month, it could have catastrophic consequences for the eurozone, and possibly lead to a sharp downturn in the world economy. It was an argument that eventually pointed to agreement for the new bailout.
Even as the Greek government has complied with the international demands for more austerity, the country’s workers have repeatedly taken to the streets in opposition.
(Sources: VOAnews, Reuters)