LUXEMBOURG :Day-long talks among Eurozone nations to agree on the final elements of a plan to get Greece out of its eight-year bailout program went past midnight and into Friday belying the early optimism that a deal would be easy to find.
The finance ministers of the 19 nations sharing the euro currency picked up the negotiations from high-level officials in the early afternoon, but found it surprisingly tough to find a compromise which had seemed with easy reach for the past few days.
The ministers needed to finalize a deal between Greece and its international creditors that would allow it to safely emerge from its third and final bailout program on Aug. 20 and face the markets again.
“I am very confident that we will find a deal,” said EU Commissioner Pierre Moscovici, echoing positive comments from the French and German finance ministers about Greece’s efforts to get its economy back on track.
“We have to recognize that Greece has really made the job – they have fulfilled their commitments,” said French Finance Minister Bruno Le Maire during a news conference with his German counterpart, Olaf Scholz.
Yet despite those good vibes the deal to keep Greece’s debt manageable remained elusive. Greece has needed massive financial aid from eurozone nations and international creditors to survive financially for the past eight years. In return, it had to commit to stringent budget austerity programs that hurt the finances of ordinary Greeks and caused a major rift between Athens and many euro nations. Even after its bailout program ends this summer, it will be under strict supervision of its policies.
One of the final issues Thursday is how to let Greece spread some of its debt repayments over more years to make sure the cost of repaying the loans does not stifle the economy. Greece’s economy has already contracted by about a quarter since its financial crisis began in late 2009 and growth is a key element in reducing the debt burden.
To make a deal possible on Thursday, Greek lawmakers last week pushed through a last batch of economic reforms required by the creditors, including pension cuts to health care and tax reforms. Once the bailout is over, Greece will have to finance itself by borrowing on international bond markets.