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Bailout Deal For Greece is Moving Closer

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Greece bailout

Bailout Deal For Greece is Moving Closer

Aug 11 2015, 07.56am GMT


No details have emerged from the weekend meetings between Greece and its creditors, besides a European official who said “a lot of progress is being made” without defining the areas of progress.

Reuters reported on August 6 that French President Francois Hollande and Greek Prime Minister Alexis Tsipras met on the sidelines of a ceremony in Egypt to inaugurate the New Suez Canal which is important to the shipping of both Greece and France. The two leaders said that a deal would be concluded by August 15 and if not by then, by the end of August at the latest.

Among the ships participating in the inaugural voyage through the new canal was the Greek frigate “Spetsai”.

The next deadline in the whole debacle is August 20, the date on which 3.2 billion euros of Greek government bonds owned by the European Central Bank (ECB) fall due. A default by Greece on these bonds would implicate heavily on Greece’s ability to remain financially viable as it would in all likelihood compel the ECB to withdraw the extensive support given to the Greek banking system.

In addition, an announcement has just been made that an agreement has been reached between the parties.

Greek Reporter has reported that a consensus has been reached between Greece and its international creditors on a multi-billion euro bailout agreement according to a report from the Greek finance ministry.

A Greek official from the finance ministry said that after the overnight talks, “An agreement has been reached. Some minor details are being discussed right now.”

According to the source in the finance ministry, the two sides had reached an accord following mutual concessions on “thorny” issues such as red loans, the state assets fund and the energy market.

The detailed agreement containing the final list of prior actions which is 27 pages long now has to pass through the Greek parliament. The other important decision to be ratified by the parliament is the memorandum of understanding and the loan agreement.

After the whole package has been approved by the Greek parliament, it then has to go back to the eurozone finance ministers. Certain countries, most importantly Germany, would then have to move the process forward by obtaining parliamentary approval of the deal.

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