Eurozone defers decision on 2nd bailout for Greece

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Eurozone finance ministers on late Thursday set three conditions for the Greek authorities to receive a second bailout package deemed vital for Athens to avert a chaotic default next month.


President of Eurogroup and Prime Minister of Luxembourg Jean-Claude Juncker attends a press conference after the Eurogroup finance ministers' meeting in Brussels, capital of Belgium, Feb. 9, 2012. Eurozone finance ministers said late Thursday that the Greek authorities have not done enough to convince international lenders to approve a crucial new bailout package. [Xinhua] 

"Despite the important progress achieved over the last days, we did not yet have all necessary elements on the table to take decisions today," Eurogroup President Jean-Claude Juncker said after a meeting of eurozone finance ministers was closed.

Juncker made the comments hours after Greece's prime minister Lucas Papademos announced in Athens the conclusion of "a general agreement" on the contents of a second bailout program without disclosing details.

"First, the Greek parliament should approve on Sunday the policy package agreed between Greece and the 'troika'," Juncker said at a press conference after the meeting.

"Secondly, additional structural expenditure reductions of 325 million euro in 2012 should be rapidly identified in order to ensure that the deficit target is achieved," Juncker said.

"Thirdly, we would need to obtain strong political assurances from the leaders of the coalition parties on the implementation of the programme," he said.

Due to the failure of the Greek government to implement many of the reformed agreed as part of the first bailout package in May 2010, the "troika" has been insisting major political parties in the Greek government make firm commitment to painful structural reforms and austerity measures before signing on the bailout program.

The 130 billion-euro (about 172 billion U.S. dollars) bailout package, offered by the "troika," namely, the International Monetary Fund, the European Commission and the European Central Bank, is crucial for Greece to avoid default or a potential exit from the eurozone on March 20 when 14.5 billion euro of bonds come due.

"These three elements, those I mentioned, need to be in place before we can take decisions. We welcomed the assurances provided by the Greek government that all the necessary elements will be put in place in the coming days," Juncker told reporters.

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