Euro zone agrees new debt relief for Greece

FRANKFURT: Euro zone finance ministers approved new debt relief measures to relieve Greece’s colossal debt mountain in the wake of its huge 86-billion-euro bailout, but at levels far short of those demanded by the IMF.

“The Euro group endorsed today the full set of short-term measures” including extending the repayment period and an adjustment to interest rates, the euro zone’s 19 finance ministers said in the statement. The ministers accorded Athens the small measures to reduce Greece’s debt as a reward for completing the latest round of reforms demanded in the country’s massive bailout programme — its third since 2010.

“We will start implementing them in the next weeks,” said Klaus Regling, the head of the European Stability Mechanism, the euro zone’s bailout fund.

However the ministers refused to officially sign off on the bailout’s second review as expected, telling Athens that there still remained a few open questions on Greece’s reform efforts.

The talks were marred by a row with the International Monetary Fund, as Europe and the fund remain as far apart as ever on the level of need for debt relief measures.

This is a crucial demand for the fund to back the bailout programme in which for now it plays only a technical role.

The hardline stance on debt relief by the ministers, led by Germany’s powerful Wolfgang Schaeuble, comes as key elections approach next year in Germany and the Netherlands, where bailout fatigue is running rife with voters. — AFP