Greece, Euro Zone Agree 4-Month Loan Extension, Avert Crunch
TEHRAN (Tasnim) - Euro zone finance ministers agreed in principle to extend Greece's financial rescue by four months, averting a potential cash crunch in March that could have forced the country out of the currency area.
The deal, to be ratified once Greece's creditors are satisfied with a list of reforms it will submit next week, ends weeks of uncertainty since the election of a leftist-led government in Athens which pledged to reverse austerity.
"Tonight was a first step in this process of rebuilding trust," Jeroen Dijsselbloem, chairman of the 19-nation Eurogroup, told a news conference. "We have established common ground again to reach agreement on this statement."
The agreement, clinched after the third ministerial meeting in two weeks of acrimonious public exchanges, offers a breathing space for the new Greek government to try to negotiate longer-term debt relief with its official creditors, Reuters reported.
But it also forced radical young Prime Minister Alexis Tsipras into a major climbdown since he had vowed to scrap the bailout, end cooperation with the "troika" of international lenders and roll back austerity.
European Union paymaster Germany, Greece's biggest creditor, had demanded "significant improvements" in reform commitments by Athens before it would accept an extension of euro zone funding.
The two main combatants around the table put a radically different gloss on the result.