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Eurogroup Agrees on New Assistance Program for Greece

Finance Ministers of the Eurogroup agreed in Brussels last night on a second financial assistance program for Greece, which they stated “provides a comprehensive blueprint for putting the public finances and the economy of Greece back on a sustainable footing and hence for safeguarding financial stability in Greece and in the euro area as a whole.” Euro area Member States will provide through the EFSF and with an expected IMF contribution up to 130 billion euro until 2014, along with a 53.5 percent nominal haircut by the country’s private sector bondholders.

European Commission President José Manuel Barroso said that “this overall package opens the way for Greece to construct a new and more sustainable economy, better able to generate growth and jobs. It also closes the door on a scenario of an uncontrolled default, with all its grave economic and social implications.”

European Commission Vice-President Olli Rehn pointed out: “We expect that this unprecedented solidarity of Greece’s euro area partners is now matched with a strong commitment by the Greek political leaders to fully implement the program first and foremost for the benefit of their fellow citizens.”