After three years, Europe has declared that it has finally discovered the formula to help ailing Eurozone member Greece.
That clears the way for Greece to receive in December the critically important next installment of rescue funds. It also clears away some major cobwebs in the global economic picture.
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European finance ministers say the new package of initiatives will put Greece on a sustainable path toward recovery.
They cut interest rates on bailout loans, suspended interest payments for an entire decade, gave Greece more time to pay back the loans, and devised a Greek bond buy-back program.
Greece’s Prime Minister Antonis Samaras announced on Greek television that it is a new day for the country. But Greece will have to deliver on each phase of the agreement to earn each bailout payment.
This is the only caveat in the deal. If proceeds come in below target, renewed talk of an official sector debt write-down could ensue.
Both the International Monetary Fund (IMF) and the European Central Bank (ECB) put their blessings on the new accord and proclaimed it a milestone in Europe’s fight
to resolve its debt crisis.