Greece debt crisis: Eurozone to discuss new bailout

July 1st, 2015 by Staff

(www.bbc.com)

Eurozone ministers are to discuss a Greek request for a new bailout, hours after Athens missed the deadline for a €1.5bn (£1.1bn, $1.7bn) payment to the International Monetary Fund (IMF).

On Tuesday, eurozone finance ministers refused to extend the previous bailout following the collapse of talks.

As a result, Greece became the first European Union country to fail to repay an IMF loan and is now in arrears.

There are fears that this could force Greece out of the eurozone.

In one of two crucial meetings on Wednesday afternoon, officials with the European Central Bank (ECB) will decide whether to grant an emergency loan to Greece.

In the second, eurozone finance ministers will discuss Greece’s latest proposal for a third bailout. It would last two years and amount to €29.1bn.

Ministers discuss the proposal in a conference call at 15:30 GMT.

A senior adviser to the Greek government, Elena Panaritis, told the BBC they expected a bailout to be agreed on Wednesday.

 

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Analysis: Chris Morris, Europe correspondent

For the first time in five years of crisis, the Greek government has no access to any kind of international funding from the EU and the IMF. It is skating on thin ice.

The ECB will also decide whether the collateral offered by Greek banks in return for tens of billion of euros in emergency loans is still sufficient.

Greek banks are already closed after ECB funding was capped at the weekend. So Greece’s hold on its place in the eurozone, the single currency area that has become the most important symbol of European unity, is more tenuous than ever.

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