Tuesday

23rd May 2017

Extra aid for Greece on table after Luxembourg meeting

  • Greece may need a further €25 billion to cover its debts next year (Photo: Aster-oid)

Another round of aid for Greece and an overhaul of its bail-out package is under consideration, European officials have said following a meeting of finance ministers in Luxembourg on Friday (6 May) that attendees struggled to keep secret.

With the likelihood of Athens' ability to return to money markets in 2012 ever-diminishing, a select clutch of eurozone finance ministers gathered in the Grand Duchy to discuss possible options.

Dear EUobserver reader

Subscribe now for unrestricted access to EUobserver.

Sign up for 30 days' free trial, no obligation. Full subscription only 15 € / month or 150 € / year.

  1. Unlimited access on desktop and mobile
  2. All premium articles, analysis, commentary and investigations
  3. EUobserver archives

EUobserver is the only independent news media covering EU affairs in Brussels and all 28 member states.

♡ We value your support.

If you already have an account click here to login.

Finance ministers from Germany, France, Italy, Spain and Greece attended the meeting alongside EU economics commissioner Olli Rehn.

Greek finance minister George Papaconstantinou informed the core eurozone states on his own economy's state of play.

Even taking into account the €110 billion EU-IMF loan, Greece must find an estimated additional €25 billion by next year to finance debt repayments.

"We think that Greece does need a further adjustment program," eurogroup chair and Luxembourg Prime Minister Jean-Claude Juncker said following the meeting.

However, the possibility of Greece withdrawing from the single currency was not discussed, as had initially been reported by Germany's Der Spiegel Online.

"We're not discussing the exit of Greece from the euro area. This is a stupid idea - no way," he said. "We don't want to have the euro area exploding without any reasons."

French business broadsheet Les Echos is reporting that Papaconstantinou had won agreement on a further €20-25 billion being made available.

A restructuring or controlled default on the country's debt appears to have been ruled out, favouring instead an additional chunk of bail-out cash.

"We were excluding the restructuring option which is discussed heavily in certain quarters of the financial markets," Juncker continued.

Possible options beyond hiking the sums in the €110 billion rescue package provided to Greece last May include extending the payment period.

Athens has already won one round of easing for its payment terms this year. Allowing the EU's €440-billion rescue fund to purchase Greek bonds may be another option.

No decision has been made however, but the choices are to be presented to EU finance ministers later this month.

The ministers who organised the bungled secret meeting have since come in for criticism for their handling of the situation.

Finance ministries and the European Commission issued a series of denials or statements saying little more than 'no comment' after Der Spiegel first reported the meeting, only to confirm that the meeting had gone ahead afterward.

Officials however stressed that no discussion on a Greek euro withdrawal was discussed, but admissions that they had lied about the meeting raise questions as to whether these statements are honest as well.

The single currency declined in the wake of the rumours, sliding to $1.4316 at one point, down 1.3 percent.

One EU official told this website: "Why we needed another hamfisted cloak-and-dagger game that only sends journalists and speculators into a frenzy and makes us all look a bit silly beats me."

Senior experts from the EU-IMF-ECB troika descend upon Athens on Tuesday to review the government's latest €26 billion austerity plans and scheme to sell off €50 billion in state assets.

Portugal held up as symbol of EU recovery

Portugal to sail out of troubled waters after eight years of financial crisis, EU commission predicted, amid broad but "fragile" recovery in European economy.

Trade deal ratification needs member states, EU court says

The EU Court of Justice has ruled that the Singapore trade deal needs member states' ratification in its current form. It said that only investments do not belong under the EU's sole competence, potentially removing Brexit complications.

Stakeholders' Highlights

  1. UNICEFChild Alert on Myanmar: Fruits of Rapid Development yet to Reach Remote Regions
  2. Nordic Council of MinistersBecome an Explorer - 'Traces of Nordic' Seeking Storytellers Around the World
  3. Malta EU 2017Closer Cooperation and Reinforced Solidarity to Ensure Security of Gas Supply
  4. European Healthy Lifestyle AllianceHigh-Intensity Interval Training Is Therapeutic Option for Type 2 Diabetes
  5. Dialogue Platform"The West Must Help Turkey Return to a Democratic Path" a Call by Fethullah Gulen
  6. ILGA-EuropeRainbow Europe 2017 Is Live - Which Countries Are Leading on LGBTI Equality?
  7. Centre Maurits CoppietersWhen You Invest in a Refugee Woman You Help the Whole Community
  8. Eurogroup for AnimalsECJ Ruling: Member States Given No Say on Wildlife Protection In Trade
  9. European Heart NetworkCall for Urgent Adoption of EU-Wide Nutrient Profiles for Nutrition & Health Claims
  10. Counter BalanceInvestment Plan for Europe More Climate Friendly but European Parliament Shows Little Ambition
  11. Mission of China to the EUPresident Xi: China's Belt and Road Initiative Benefits People Around the World
  12. Malta EU 2017EU Strengthens Control of the Acquisition and Possession of Firearms