EU FinMins Withhold Greek Loan until New Austerity
2011-06-20 13:03:03
Finance ministers from the European Union meeting in Luxembourg decided overnight to postpone their decision on the last tranche of the EUR 110 B loan to Greece.
Greece first must implement far-reaching austerity measures including privatization and social benefits cutbacks amounting to EUR 28 M, before receiving the last instalment of EUR 12 B
This was decided at an emergency meeting of EU ministers of finance called Sunday, which lasted into the wee hours Monday.
A large part of Greek citizens have expressed their firm opposition to the measures in huge protests across the country last week, including Sunday.
Speaking at the start of three days of debate, Greek PM George Papandreou said the country was "at a crucial point" and risked a catastrophic default if it did not receive the loan.
Overnight ministers said they expect the instalment to be paid by mid-July, but only conditional on the implementation of the new austerity measures.
EU finance ministers also agreed to frame a second loan to keep the crisis hit country going for the next few years.