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Athens cites 4-mo. loan deal extension; must spell out measures by Mon

The decision was reportedly reached after 20 minutes of a Eurogroup meeting in Brussels

Newsroom February 20 08:19

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Athens on Friday evening referred to a four-month deal to extend its loan agreement with eurozone creditors, a development that translates into a successful conclusion to the often acrimonious deliberations following the formation of a new Greek government on Jan. 26.

The decision was reportedly reached after 20 minutes of a Eurogroup meeting in Brussels, which followed a four-hour meeting between EC President Jean-Claude Juncker, IMF head Christine Lagarde, Eurogroup chair Jeroen Dijsselloem with Greek FinMin Yanis Varoufakis, and separately, with Germany’s “iron” FinMin Wolfgang Schaeuble.

According to reports, again emanating from the Greek side, no new measures are envisioned in the extension, nor is there a reference to a fulfillment of the memorandum.

According to information acquired by protothema from Brussels, the basis for Friday’s deal was the most recent letter sent by Varoufakis to Dijsselbloem, requesting the extension of the current program, but for six months.

The substance of Athens’ request was adopted with clarifications on several points, according to Greek officials, who added that Athens’ request for “flexibility” in the implementation of the program was accepted, and without reference to the need for austerity measures.

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The Greek side must now table, before Monday, a memo to its eurozone partners spelling out the specific measures it will implement.

The eurozone creditors, on their part, reportedly demanded a phrase citing an extension of the current loan agreement for four months, roughly until the end of June.

The reason, given by sources, is that the Greek state must cover maturing bonds worth 6.7 billion euros to the ECB in July-August, something that gives creditors an extra “lever of pressure” on the Tsipras government. Moreover, the Greek side must also cover IMF loans worth 5.2 billion euros by the end of June.

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