Eurozone finance ministers fail to agree Greek bailout terms

21 Nov 12
Finance ministers from the eurozone countries will meet again next week after failing to agree on the terms of Greece’s next tranche of bailout funds.

By Nick Mann | 21 November 2012

Finance ministers from the eurozone countries will meet again next week after failing to agree on the terms of Greece’s next tranche of bailout funds.

The Eurogroup said that its meeting last night in Brussels had ‘made progress’ in identifying a package of measures that would enable Greece to reduce its debt. But it added that ‘further technical work’ was needed before agreeing to release the next phase of the bailout, worth a reported €31.5bn.

Differences reportedly remain between the Eurogroup and the other key contributor to the bailout, the International Monetary Fund, over exactly how long Greece should be given to reduce its debt to a sustainable level.

Last week, Eurogroup president Jean-Claude Juncker called for Greece to be given until 2022 to reduce its debt, which is forecast to reach 189% of gross domestic product next year, to 120% of GDP. However, IMF managing director Christine Lagarde said this should remain a target for 2020.

In a statement issued in the early hours of this morning, Juncker welcomed the recent austerity measures agreed by the Greek Parliament, which he said demonstrated the authorities’ ‘strong commitment’ to the adjustment programme required by the European Union and IMF.

‘Against this background, the Eurogroup has had an extensive discussion and made progress in identifying a consistent package of credible initiatives aimed at making a further substantial contribution to the sustainability of Greek government debt,’ he explained.

‘The Eurogroup interrupted its meeting to allow for further technical work on some elements of this package.’

At the end of the meeting, he added that the ministers were ‘very close to a result’ and there was ‘no major stumbling block’, but said they needed ‘very precise figures’ in order to be accountable to their governments and parliaments.

Also speaking after the meeting Lagarde said: We made some good work, we’re closing the gap, but we’re not quite there yet – so it’s progress but we have to do a bit more.’

The finance ministers from the 17 members of the single currency bloc are now set to meet again on November 26 to attempt to finalise the details.

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