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Eurogroup OKs Greek funding

April 1, 2014

Eurozone finance ministers, known as the Eurogroup, have agreed on a timetable for disbursing the next bailout funds for Greece. At a meeting in Athens, they found Greece was making sufficient progress on reforms.

Jeroen Dijsselbloem
Image: Getty Images/Afp/Louisa Gouliamaki

Greece would receive a next installment of bailout loans worth 8.3 billion euros ($11.4 billion) in three parts, the finance ministers of the euro currency area agreed at a meeting in Athens on Tuesday.

The first part of the current installment, worth about 6.3 billion euros, would be disbursed at the end of April, with the remaining 2 billion euros in rescue funding scheduled to flow in June and July, said Jeroen Dijsselbloem (pictured above), who is the head of the group of eurozone finance ministers, which is also known as the Eurogroup.

The loans come just in time for Greece to meet a bond redemption in May, and are part of a bailout program for the debt-laden country to the tune of 240 billion euros. Athens can also expect further funding from the International Monetary Fund, worth about 2 billion euros, in the near future.

Since May 2010, Greece has been dependent on rescue loans provided by a group of international lenders, known as the "troika" and comprising the European Commission, the European Central Bank (ECB) and the International Monetary Fund (IMF). The troika has made emergency funding contingent on a series of crucial reforms, including public sector layoffs and market deregulation.

Tuesday's Eurogroup decision followed the passage of a set of new reforms by parliament in Athens on Monday. The measures adopted included more market liberalization in the Greek dairy industry, as well as the publishing and pharmacy sectors.

Back on Track? What does the future hold for Greece?

Eurogroup leaders expressed the hope that the latest disbursement of loans would be the last needed by Athens.

“At the moment we don't see the need for a third rescue package for Greece,” Austria's Finance Minister Michael Spindelegger told reporters.

There is, however, a controversy among experts as to whether or not Greece will need further external funding beyond the current bailout, due to run out at the end of 2014. Some analysts believe that the struggling eurozone country will require more funds to shore up its ailing banking sector next year.

uhe/tj (Reuters, AP, dpa)