Greece is on the verge of a breakthrough in talks with its creditors that could wipe out up to 70% of its debts and alleviate the crisis in the eurozone.
An outline deal, hurriedly endorsed by Brussels, came after a frantic three days of negotiations that at one time appeared to be heading for deadlock.
It appeared that Greece had secured a deal to pay an interest rate of 3.1%, rising to 4.75%, on new 30-year bonds created from its outstanding €360bn (£300bn) debt burden. The effect would be for creditors to accept writedowns of up to 70% on many of their loans.
Sources close to the Greek government said it was still possible that major lenders could walk away if there was a failure to get agreement on some of the fine detail, but Athens was confident that further talks over the weekend would bring a comprehensive deal.
Before the news, trading on world stock markets was subdued, indicating the importance attached to a Greek deal as investors waited for the outcome before committing funds. The FTSE 100 finished the day down 12 points at 5728.55, closing before speculation surfaced that a Greek deal was imminent. The French CAC and the German Dax were also down 7 and 11 points respectively. The Dow Jones followed a more positive path into the afternoon in New York, rising more than 60 points towards 12700.
Greece has become the focus of tension in the eurozone for the third time in as many years after first announcing it was in trouble in the spring of 2010. It was bailed out along with Ireland and Portugal, then in May last year it became clear that the €110bn Athens had received would be insufficient to finance its growing debts and that a second bailout was necessary.
Source: Greece on verge of breakthrough in deal to cancel 70% of debt | Business | The Guardian
There you have it - the crisis is over and all EU members can return back to creating goods and services that are in demand all over the world.
An outline deal, hurriedly endorsed by Brussels, came after a frantic three days of negotiations that at one time appeared to be heading for deadlock.
It appeared that Greece had secured a deal to pay an interest rate of 3.1%, rising to 4.75%, on new 30-year bonds created from its outstanding €360bn (£300bn) debt burden. The effect would be for creditors to accept writedowns of up to 70% on many of their loans.
Sources close to the Greek government said it was still possible that major lenders could walk away if there was a failure to get agreement on some of the fine detail, but Athens was confident that further talks over the weekend would bring a comprehensive deal.
Before the news, trading on world stock markets was subdued, indicating the importance attached to a Greek deal as investors waited for the outcome before committing funds. The FTSE 100 finished the day down 12 points at 5728.55, closing before speculation surfaced that a Greek deal was imminent. The French CAC and the German Dax were also down 7 and 11 points respectively. The Dow Jones followed a more positive path into the afternoon in New York, rising more than 60 points towards 12700.
Greece has become the focus of tension in the eurozone for the third time in as many years after first announcing it was in trouble in the spring of 2010. It was bailed out along with Ireland and Portugal, then in May last year it became clear that the €110bn Athens had received would be insufficient to finance its growing debts and that a second bailout was necessary.
Source: Greece on verge of breakthrough in deal to cancel 70% of debt | Business | The Guardian
There you have it - the crisis is over and all EU members can return back to creating goods and services that are in demand all over the world.
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