Greece gets 2-year delay
BRUSSELS, Belgium – THE European Union cleared an extra two years for Greece to bring its public deficit within formal EU limits yesterday, the latest piece of an Athens bailout jigsaw puzzle.
A day after Greece launched a debt buyback bid aimed at slicing ¤20 billion from its huge debt pile, clearing a eurozone decision taken on November 12 now gives Athens until 2016 to get its spending gap below three per cent of gross domestic product (GDP).
EU finance ministers, wrapping up two days of talks that ranged from bailouts to banks, said Greece “is estimated to have improved its structural deficit already by 13.9 percentage points of GDP from a 14.7 per cent deficit in 2009 to an estimated 1.5 per cent deficit in 2012”.
But with economic activity expected to be “much weaker than previously expected”, Greek officials are now expected to deliver on new targets “expressed in terms of a primary surplus as a per cent of GDP” of zero per cent in 2013, 1.5 per cent in 2014, three per cent in 2015, and 4.5 per cent in 2016.
Prime Minister Antonis Samaras’ government pushed a fresh batch of deeply unpopular cuts through parliament last month, the key for the eurozone and the International Monetary Fund (IMF) to agree to unlock ¤43.7 billion in loans and grant significant debt relief going forward for decades to come.
Greece’s private creditors have already written off more than ¤100 billion in debt, and the IMF has urged the ECB to accept this solution as well.
— AFP