Greece has been given the greenlight as the Eurogroup approved Athens’ reform plans, taking it a step closer to securing a four-month loan extension.
The deal was sealed in a one hour telephone conference in Brussels, but the international creditors made clear that Greece couldn’t walk out on its commitments.
“If economic circumstances so require, fiscal targets can be adjusted within programmes – and have been adjusted in the past,” said Eurogroup President Jeroen Dijsselbloem. “But it cannot be a unilateral decision of the government involved to say “We are no longer committed to this target.” That is not the way it can work,” he added.
The deal which would avert a financial meltdown will have to be ratified by some national parliaments in the coming days.
Greek Finance Minister Yanis Varoufakis was forced to backpedal on election promises of halting privatisation, raising the minimum wage and increasing welfare spending in order to get the approval from the EU-IMF creditors.
