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EU stalls on Greece

November 21, 2012

Greece has been told it must wait until next week to find out whether it is to receive the next installment of its bailout money from international lenders. EU finance ministers delayed the decision among complications.

Euro coins and bills (Foto: DW) / Eingestellt von wa
Image: DW

After nearly 12 hours of talks, finance officials meeting in Brussels announced early Wednesday morning that they could not yet reach a final decision to lend an additional 31.5 billion euros (about $40 billion) to the crisis-stricken country. New issues that had arisen in the past two weeks complicated the terms of the financial bailout, they said.

EU President Jean-Claude Juncker expressed confidence that Greece would receive good news next Monday, when the finance ministers are scheduled to reconvene.

No deal for Greece bailout

"We are very close to a result with really no major stumbling block," said Juncker, adding that he was, "a little bit disappointed, but I have to admit that the technical issues are of…a complicated nature."

Greece's prime minister, Antonis Samaras, expressed his frustration with the delay on Wednesday and called on the finance ministers to "meet the responsibilities they have assumed."

Because the Greek government had passed austerity measures to help stabilize its finances in the long term, international lenders had agreed to grant the country two more years to lower its deficit. As a result, EU finance ministers faced the new challenge of also bridging a new financial gap of 32.6 billion euros ($41.7 billion) in the county's rescue package, according to the head of the International Monetary Fund (IMF), Christine Lagarde.

"We are closing the gap, but we are not quite there yet," said Lagarde.

The options discussed included lowering Greece's interest rates or extending the duration of its loans. EU finance ministers were also trying to decide whether to allow Greece until 2020 or 2022 to lower its deficit to 120 percent of the GDP.

"We have a series of options on the table for how to close the financing gap. We discussed them extensively," German Finance Minister Wolfgang Schäuble said. "But since the questions are so complicated, we couldn't find a conclusive solution."

While the EU finance ministers could not reach a conclusive decision on Wednesday, they refused to pass the decision to EU leaders meeting in Brussels later in the week.

Greece has pleased its international lenders in recent weeks as it slashed its budget, narrowly passing a plan that lowered salaries and pensions and raised taxes, totaling 13.5 billion euros. It has said that if the eurozone leaders don't act soon, it will go bankrupt.

kms/mz ( dpa, AFP, AP)