Eurozone finance ministers approved at their meeting in Brussels on Friday the third bailout programme for Greece.
According to a statement released by the European Commission (EC) immediately after the meeting, the new billion-dollar loans will be made available over the next three years to Greece by the ESM. Unable to borrow on the global markets, another bailout is all that stands between Greece and a disorderly default on its debts – as soon as next week – that would force it out of Europe’s joint currency.
European Commission President Jean-Claude Juncker said the approval sent a “loud and clear” message that Greece will remain in the Eurozone – ending concerns that the country would be forced out.
The vote was passed with 222 votes in favor, 64 against, 11 abstentions and three absent in the 300-member parliament.
The deal, which surrenders powers over huge areas of economic and social policymaking to Greece’s global creditors, also has to be ratified by a number of national parliaments, including Germany’s – a process Athens wants completed in time for it to make a major €3.2bn payment to the European Central Bank on 20 August. “We took the decision to remain alive instead of committing suicide and complaining how unfair it was”.
The deal was approved on Friday morning after an intense night-long debate, where Prime Minister Alexis Tsipras was challenged by members of this own party.
Greek Finance Minister Euclid Tsakalotos covers his face during a…
“This means that the “new” Syriza – the party likely to win the largest amount of votes and seats – will have to strike another coalition deal to govern”.
It comes after more than half of the Greece’s 300-strong parliament voted in favour of the bailout deal yesterday.
The leader of Syriza’s far-left rebel faction, former energy minister Panagiotis Lafazanis, took a step toward breaking away from the party on Thursday by calling for a new anti-bailout movement.
The Greek government will have to enact further deep spending cuts and hike taxes as part of the agreement. By backing a deal that involves more tough reforms, Tsipras has faced widespread accusations from within his party that he has abandoned his principles and capitulated to blackmail from the creditors.
In the third bailout deal in five years, lenders have proposed tax rises and spending cuts in return for a bailout money for the debt-laden nation.
The Eurogroup said that it would consider longer grace periods and repayment periods if Greece successfully met its loan conditions by an October review.
Greece’s most influential creditor and perhaps its harshest critic welcomed the agreement as “a good result”.
“We’re going to talk about political trust”, Dijsselbloem said earlier in the day.