Greece Bailout Extension Gets Green Light
Eurozone ministers have approved a request from Greece for a two-month extension to its bailout program that was set to end December 31, amid an ongoing budget row between Athens and its EU-IMF creditors.
"The Eurogroup would be favourably disposed to a request by Greece for a technical extension of two months of the current EFSF program," the Eurogroup of ministers said in a statement, referring to the European Union's rescue fund.
The decision comes a day after violent protests in Athens and a high-stakes budget vote in Greek parliament revived memories of the debt crisis that nearly sank the euro.
A new line of credit became urgent after Athens proposed in October to break free completely of financial oversight.
This spooked the markets, which sent Greek borrowing rates to dangerously high levels.
But a new credit line for Greece would require the previous bailout to be completed or terminated, and with a bitter row between the government and the creditors still ongoing, this seemed unlikely before December 31.
Before the talks, the influential German Finance Minister Wolfgang Schaeuble downplayed the difficulty of approving the extension.
"If we need another extension, it wouldn't be the first time," Mr Schaeuble said, while adding that Greece must remain on the path of reform.
As protests raged outside, the Greek parliament late on Sunday passed the disputed budget for 2015 based on growth and deficit figures that Greece's "troika" of creditors - the European Commission, European Central Bank, and International Monetary Fund - regard as too optimistic.
Agreement on the budget is required in order for Greece to receive the final 1.8 billion euro instalment of its huge bailout that has totalled a whopping #$%$240 billion ($319bn) in rescue loans since 2010.
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