Greece gets green light for fresh bailout cash

Mário Centeno at the Eurogroup meeting on 22 January 2017. [Council]

Eurozone finance ministers approved another 6.7 billion euros in bailout cash for Greece yesterday (22 January) after Athens pushed through controversial reforms that drew strikes and protests.

The tranche is the latest from Greece’s third financial rescue programme since 2010, as the southern European country recovers from the depths of a debt crisis that brought the whole euro currency close to collapse.

“On Greece there is good news,” Portugal’s Mário Centeno, chairing the Eurogroup of 19 finance ministers for the first time, told a news conference after a meeting in Brussels.

“This reflects the huge effort and excellent cooperation between the Greek government and the institutions” representing Greece’s creditors, said Centeno.

Greece, lenders reach deal on reforms under bailout review

Greece and its euro zone creditors reached a preliminary deal on Saturday (2 December) on reforms Athens needs to roll out under its bailout programme, a move that could pave the way for the country to leave the aid plan in August.

“The next disbursement will amount to 6.7 billion euros” to cover debt servicing, arrears and to boost Greece’s cash reserves, said Centeno, adding that it was “critical to ensure Greece’s full market access.”

The tranche will be split into €5.7 billion paid in February and the remaining one billion paid later in the spring once eurozone officials have checked that Greece has carried out all the reforms, the Eurogroup said in a statement.

Centeno said that the eurozone would now start to look at cutting Greece’s huge debt pile, equivalent to 180% of its annual economic output.

“Looking ahead we can start with the technical work on debt relief measures,” he said, particularly those that linked debt relief to economic growth.

Subscribe to our newsletters