European Union body European Financial Stability Mechanism approved a €7.16bn bridge loan for Greece on Friday. The bridge-loan will have a maximum maturity of three months and will be disbursed in up to two installments – the first is expected to arrive in Athens by Monday. The loan will allow Greece to clear its arrears with the IMF and the Bank of Greece and to repay the ECB.
Greece’s €3.5-billion payment of interest to ECB is due on Monday. Some €2 billion overdue payments to IMF for June and first July tranche will be paid once the bridge loan arrives. Greece has also a payment to ECB in August.
EU – EFSM STATEMENT
On 17 July 2015, the Council adopted a decision granting up to €7.16bn in short term financial assistance to Greece under the European Financial Stabilisation Mechanism (EFSM).
The loan will have a maximum maturity of three months and will be disbursed in up to two instalments. It will allow Greece to clear its arrears with the IMF and the Bank of Greece and to repay the ECB, until Greece would start receiving financing under a new programme from the European Stability Mechanism (ESM).
Longer term programme
On 16 July the Eurogroup decided in principle to agree to a request made by Greece on 8 July 2015 for stability support over three years from the ESM. Once negotiated between the institutions and Greece and approved by the Eurogroup, the ESM assistance would be used, amongst other things, to repay the loan Greece receives under the EFSM.
Economic policy conditions
The Council also adopted a decision approving a macro-economic adjustment programme setting out specific economic policy conditions attached to the financial assistance. The reforms undertaken by Greece are aimed at improving the sustainability of its public finances and the regulatory environment. Specifically, Greece was required to adopt legislation to reform its VAT and pension systems, strengthen the governance of the Hellenic Statistical Authority (ELSTAT), and implement by 15 July 2015 the relevant provisions of the Treaty on Stability, Coordination and Governance. The adjustment programme will be set out in a memorandum of understanding (MOU).
The financial assistance would be disbursed once the MOU and a loan facility agreement setting out in detail the financial terms have entered into force. Both are to be signed by the Commission and the Greek authorities.
source: consilium europe
What’s the cost of the bridge-loan to the Greeks? Hm… I see no interest mentioned in the Press Release… But the V.A.T. hikes skyrocketing food items to 23% start as early as Monday.
Using one credit card to pay off another credit card. Deeper and deeper into debt Greece goes. But the banks will open and all is well. What was that line from the Traffic song?
The percentage you’re paying is too high priced;
While you’re living beyond all your means;
And the man in the suit has just bought a new car;
From the profit he’s made on your dreams…
banks will open with capital controls. so nothing is well.
You have been bad. So the banksters must punish you. Just like they did Ireland and Cyprus. THEY control Greece. Not your Parliament or your PM. You are hooked and hooked well and the price of freedom is more than the majority will endure.
The US will take longer, but we are well on our way with our 20 TRILLION dollars of debt.
no worries. you have China :p
Finishing… in the long run – 10 years- maybe it would be better (maybe, not sure)… Greece would be free from austerity, much debt would be reduced. And drachma would revalue… But I understand the long row of prime ministers who preferred austerity: Papandreou, Samaras ans Ts… (but I understand also the persons who preferred the risk)
The initial effect would be an amazing implosion , and people who kept money in the bank, public officers and old age pensioners would not be happy.
Massive devaluation and introducing drachma with closed banks would be probably no freedom, either. The most probable scenario : Probably at the beginning devaluation could be 2/3 – such are data from Russia 1998 and Argentina 2001.
It is a riddle whether Tsipras did well choosing austerity in the last moment. It probably depends on a person – old age pensions would be devastated after devaluation, but for example more young people would get a job… paid maybe 2 times less than today average counted in euro, but they could buy pretty the same amount of local products. And the economy would start again without distortions…
But still, the president of Argentina escaped from his country with a helicopter… So there are dangers involved in devaluation story…
no money to tank helicopters either
The money to tank a helicopter would find itself. Crisis is crisis, but if the president / emperor / king / warlord wants to escape… There is enough petrol.
Brandnew news: Leading German tourism industry runs amok as plans have leaked….
what? link?
Tomorrow on moufanet, may be …
sorry,
at least google putinfish santorini and then photoshop the putinfish?
so what’s the purpose of claiming …crap?
Filling holes by digging holes.The EU logic is astonishing. They are simply practising the very financial practices that got the world to this point in the first place: wreckless lending produces wreckless borrowing which produces more debt which is “paid” by more wreckless lending…
When will it be enough? When the money finally realise that the make belief of all this profit to be made on their loans is exactly that; make belief, and they end up with nothing. That is when the guns and tanks will come out… Versailles Treaty all over again.
Aah, I’m crying. Merkel & Schaeubler want to do their utmost to help Greece. Who do they think they are fooling, other than themselves. Another loan to pay back a loan. Wake up Greeks; Grexit would be difficult for some years but there is a light at the end of the tunnel. Bailout + austere measures is a one way street with no end, only darkness forever…
The appear to be in the business of (successfully) fooling the German Volk. These are the same people and culture who supported the Nazi movement for decades, and thought Hitler was a really decent guy who was just not very fond of Jews, homosexuals and left wing people.