Greece bailout: draft agreed after crunch talks

Picture: Greek Finance Minister Yanis Varoufakis speaks ahead of today’s emergency meeting of Eurozone finance ministers hours before the bailout programme was agreed. (Getty)

After days of crunch talks between eurozone finance ministers, a common text has been drafted which could form the basis for an agreement to extend Athens’ bailout package.

Failure to win an extension of Greece’s bailout would most likely have sent the country into default, signalling its exit from the euro.

While officials at the meeting stressed that no formal agreement had yet been agreed, the draft text is the most promising development to emerge so far.

“There is an initial agreement on a joint draft text among the institutional partners, which is now being presented to all of the ministers,” a Greek government official said after preparatory talks between the Greek and German ministers.

“Details may be defined later. But let’s see.”

Jeroen Dijsselbloem, the meeting chairman, is now presenting the two page draft statement to the 19 Eurogroup ministers.

The European Central Bank and the International Monetary Fund are also involved in the negotiations, because they are creditors.

With the 240 billion euro EU/IMF bailout program due to expire in little more than a week, Prime Minister Alexis Tsipras had voiced confidence of an agreement despite the objections to the request made in a letter to Dijsselbloem.

“I feel certain that the Greek letter for a six-month extension of the loan agreement with the conditionalities that accompany it will be accepted,” Tsipras said in a statement to Reuters hours before the crucial Brussels meeting.

German Chancellor Angela Merkel, speaking after talks in Paris, said all EU partners wanted to keep Greece in the euro but added: “There is a need for significant improvements in the substance of what is being discussed so that we can vote on it in the German Bundestag, for example next week.”

“Where this leaves Europe is very scarred…” – I explain what lies ahead in #Greece bailout talks. http://t.co/incex5mhV5

— Paul Mason (@paulmasonnews) February 20, 2015