Ecofin releases 7.1 bln-Euro bridge loan to Greece

UK raises criticism over loan

The European Economic and Financial Affairs Council (Ecofin) has approved a 7.16-bln-Euro bridge loan to Greece, which will allow the crisis-battered country to cover its overdue debt obligations over the next three months to the IMF, the Bank of Greece and the ECB.

European Commission Vice President Valdis Dombrovskis said the institutions’ procedures for the immediate funding to Greece have been completed.

The United Kingdom expressed its strong opposition regarding the funding process, as the loan will be channeled via the European Financial Stability Mechanism (EFSM), which also comprises countries outside the Eurozone bloc.

It should be noted that the UK is not part of the Eurozone.

The loan will be dispensed in two tranches and will serve as support to Greece until the country receives the large bailout package through the ESM on condition of implementing harsh austerity measures.

Responding to reporters, Dombrovskis said the EU had proven its solidarity to Greece, while he added that the issue of debt relief was on the table of discussions. He did, however, clarify that a nominal hair-cut of the huge debt was not under consideration. He said that the ESM board would convene after the Eurogroup meeting was completed Friday afternoon.