DESPITE CONFLICTING REPORTS it appears inevitable that Greece’s bailout package, agreed exactly a year ago, will need to be renegotiated.
A secret meeting was held between the Greek government and EU officials in Luxembourg on Friday where it was initially reported that Athens was contemplating pulling out of the euro.
This appears not to be the case, however it has emerged that Greece will not be able to meet the terms of last year’s €110 billion rescue package it agreed with the EU and IMF and will likely request more funds from the eurozone, the Guardian reports.
Greece currently has debt of around €340 billion.
The Financial Times is reporting that Greece’s aid package is to be ‘revamped’ citing an acknowledgement from the chairman of the euro group of finance ministers, Jean Claude Juncker, who said at the weekend:
We think that Greece does need a further adjustment programme.
Juncker dismissed reports of Greece exiting the euro, which originated in German magazine Der Spiegel, as a “stupid idea”.
Greece needs to raise €25-30 billion next year to meet debt repayments that would not be covered by its current loan.
The Telegraph reports that European leaders are preparing to allow the Greek government to access Brussels’ emergency funding mechanism, the European Financial Stability Fund (EFSF), to roll over its maturing debts.
A restructuring has been ruled out, according to Juncker, the ECB president Jean Claude Trichet and the EU’s top financial official Olli Rehn.
A Greek official has also denied restructuring, telling Bloomberg “it is not an option on the table.”
In response to the growing uncertainty over Greece, shares on the European markets are expected to fall on Monday, Reuters reports.
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