Tonight's Headlines: Bloomberg - Europe Fails to Agree on Greek Aid Payout; Reuters - Euro Zone Agrees To Pursue Greek Debt Rollover Plan
Good thing the media is in agreement...
Europe Fails to Agree on Greek Aid Payout, Pressing Papandreou
European governments failed to agree on releasing a loan payout to spare Greece from default, ramping up pressure on Prime Minister George Papandreou to first deliver budget cuts in the face of domestic opposition.
On the eve of a confidence vote that may bring down Papandreou’s government, euro-area finance ministers pushed Greece to pass laws to cut the deficit and sell state assets, and left open whether the country will get the full 12 billion euros ($17.1 billion) promised for July.
“We forcefully reminded the Greek government that by the end of this month they have to see to it that we are all convinced that all the commitments they made are fulfilled,” Luxembourg Prime Minister Jean-Claude Juncker told reporters early today after chairing a seven-hour euro crisis meeting in Luxembourg.
Decisions on the next payout and a three-year follow-up package were put off until early July, prolonging Greece’s fiscal agony and heightening the brinksmanship that has marked Europe’s handling of the unprecedented debt crisis.
Meanwhile, over at Reuters:
Euro zone agrees to pursue Greek debt rollover plan
Euro zone finance ministers agreed on Monday that they would seek voluntary rollover of Greek debt by private bondholders to finance a substantial part of Greek funding needs in coming years.
The agreement means a German idea of Greek bond swaps has been dropped.
"Ministers agreed that the required additional funding will be financed through both official and private sources and welcome the pursuit of voluntary private sector involvement in the form of informal and voluntary roll-overs of existing Greek debt at maturity for a substantial reduction of the required year-by-year funding within the programme, while avoiding a selective default for Greece," the ministers said in a statement after a meeting in Luxembourg.
The ministers noted, however, that Greek debt would only be sustainable if Athens delivered on its fiscal consolidation plans, raised 50 billion euros ($72 billion) from privatisation until 2015, and implemented structural reforms.
At least we can all agree that the chaos is now absolutely complete.
Update: Reuters has since nudged their story as follows:
Europe delays decision on emergency loans to Greece
Euro zone finance ministers postponed a final decision on extending a further 12 billion euros ($17 billion) in emergency loans to Greece, saying Athens would first have to introduce harsh austerity measures.
The ministers said in a statement that they expected to pay the money by mid-July. Greece has said it needs the loans by then to avoid defaulting on its debt.
But keeping up the pressure on Athens, the ministers insisted that disbursement would depend on the Greek parliament first passing laws on fiscal reforms and selling off state assets.
The statement, issued after a seven-hour meeting in Luxembourg that ran into the early hours of Monday morning, also committed the ministers to putting together a second bailout plan for Greece, beyond an initial 110 billion euro rescue launched in May last year.
The ministers said that in addition to more official loans, the new bailout would include a voluntary rollover by private investors of their Greek debt holdings. The statement did not say how large the new plan would be or give details of the rollover..... etc
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