Greece creditors agree on deal

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Greece creditors agree on deal

Greece's political leadership warmly welcomed on Friday Eurogroup's "historic decision" on the Greek debt, which opens the way for the exit from the bailouts era this summer after eight years of debt crisis.

Eurozone finance ministers early on Friday extended maturities and deferred interest of a major part of their loans to Greece along with a big cash injection to ensure Athens can stand on its own feet after it exits its bailout in August. "The question of the Greek debt is behind us".

This will provide Greece with a financial cushion of 24 billion euros, with which Athens could pay off its debts in the next 22 months without having to resort financing on the market to support itself.

"The accepted criteria for all sides is that this solution be convincing for markets and embed the creditworthiness of our country - the final act in restoring the credibility of Greece to be able to plan for the next day like any ordinary country", Tzanakopoulos told a news briefing.

Greece's current global bailout, the country's third rescue programme since 2010, ends in August. Out of this amount, 5.5 billion will be disbursed to a segregated account, to be used for debt servicing and 9.5 billion will be disbursed to a dedicated account set up to build up cash buffers, to be used for debt service in case of needs.

Athens faces bond repayments of around 7 percent of its output next year, the first after its third bailout ends in August.

European Union officials have repeatedly said the meeting will be crucial to seal Greece's financial future.

Greece has already received substantial debt relief during the crisis.

Figures released yesterday by the Germany government in response to a parliamentary query submitted by the opposition Green Party revealed that Germany has made 2.9 billion euros in interest payments on Greek bonds since 2010, according to German media reports. Official creditors do not accept such "haircuts" but have eased lending terms which reduced the net present value of the loans granted to Athens, resulting in further budget savings.

Greece's prime minister pledged Friday to stick to agreed reforms and budget targets after global creditors announced debt relief measures to wean the country off its eight-year bailout program, which ends in two months.

Opposite the hardliners, who also include the Netherlands and other northern eurozone countries, are France and the European Central Bank, which argue that reduced debt is crucial in order for Greece to gain the trust of the markets.

Greece "has fulfilled its obligations, and now the Eurogroup must keep its promises", MP Kindler said, calling for "substantial debt relief" for the troubled Mediterranean nation.

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