10 August, AtoZForex.com, Lagos – Greece is back in the headlines as the country edges closer to unlocking a fresh €86bn (£61bn) rescue package for a Greece third bailout . This follows the reported agreement on a draft deal over the weekend with its European creditors.
Greek government officials entered discussions on a draft of the country’s third bailout agreement drawn up on the basis of deliberations with EU/IMF lenders, a government official said on Saturday. Athens now seeks to receive the first disbursement of aid by August 20, when it faces a debt payment to the European Central Bank. Progress is obviously being made in this negotiation procedure as representatives of the European Union and International Monetary Fund lenders met Greece’s finance and economy ministers in Athens on Saturday. This came a day after EU finance officials held a teleconference and noted progress in the talks.
According to reports from the meeting, which lasted six hours, Greece is expected to slash defence spending and subsidies for farmers as part of a fresh package of austerity measures, as reported by German newspaper Frankfurter Allgemeine Sonntagszeitung.
Yet it wasn’t all roses as the Greece still faces stiff opposition from countries like Finland, which threatened on Saturday to withhold its support for a new deal. Timo Soini, the country’s foreign minister, said Finland was “running out of patience” with Greece, as he insisted that a Greek exit from the Eurozone was still the most likely outcome. “Of course we can stay out , that is possible,” he told Reuters. In a another interview with Bloomberg, Mr Soini said: “Truth is the strongest force … We should admit that this isn’t going to work.”
The Finland finance minister admitted that Finnish opposition would not derail a a third bail-out, pointing at an emergency voting procedure whereby financial assistance can be granted if supported by a qualified majority of 85pc of the votes cast. Finland has a share of less than 2pc of the vote.
“If we vote against a deal, it goes to the emergency procedure, and a package is implemented regardless of us,” said Mr Soini. “I don’t believe that this policy will provide solutions, and I think that, in the longer term, ‘Grexit’ is the most likely scenario,” he said.
However, reservations from Germany could also stall negotiation progress.