EU, Greece Reach Initial Bailout Agreement

Greece’s creditors have agreed a program of reforms as the country’s third and final bailout comes to an end, the European Commission said Saturday. Athens was rescued three times by European and international creditors, preventing the country from crashing out of the euro.

It returned to growth in 2017 after nine years of deep recession, and the bailout relief is due to end in August, AFP reported.

“After so many difficult years, efforts and sacrifices, Greece is finally on the home stretch,” European Union commissioner Pierre Moscovici said.

With a meeting of eurozone finance ministers set for June 21, teams of experts from the EU, the European Central Bank and the International Monetary Fund have met with the Greek government in recent days to discuss its privatization drive, an overhaul of the civil service and the deregulation of the state-dominated energy market.

In a statement that gave no detail on the agreement, the EU’s executive said a staff-level accord had been reached. “The Greek authorities aim to implement these measures as swiftly as possible in advance of the Eurogroup of June 21,” it added.

While Greece’s economy is now in better shape, successive bailouts have left it with debt levels at an unsustainable 180% of its annual economic output.

France has called for extending Greek loans by 12 years and capping interest at 2%, thereby reducing repayment by €18 billion ($21.22 billion).

But powerful Germany, Greece’s biggest creditor, is extremely reluctant to pare back the Greek debt pile and has demanded Athens meet strict targets even after the bailout ends in August.

Greek Finance Minister Euclid Tsakalotos declared, “The staff-level agreement is closed. We have an agreement on all issues.”