110 billion euro bail-out for Greece by Zuzana Zelenakova

Members of the Eurozone and the International Monetary Fund (IMF) have agreed on 110 billion euro ($146.2 billion) bailout plan for Greece. The loan is aimed at preventing Greece from defaulting on its enormous debt. Athens will get 80 billion euro in funding from European Union and the rest will come from the IMF. The loan will be delivered to Greec over the next three years with the first part of the package being paid within few weeks. Severe cuts and tax raises in Greece are part of the deal. However, parliaments of all the 16 members of the EU yet need to approve the rescue package. The EU summit that should discuss the impact of the Greek crisis should be held in Bru! ssels on Friday. The most reluctant member to approve the bailout is Germany that is most likely to pay the biggest part of it. "I think that this is a very ambitious programme," said Chancellor Angela Merkel, who was widely criticized for her deprecative attitude. she added that it was "the only way to ensure the stability of the euro." Greece with its battered economy informed Sunday that the government forecast is that the GDP will fall 4 percent in 2010. The national debt is predicted to rise to 149 percent by 2013 before dropping. "With our decision today our citizens will have to make great sacrifices," said Greek Prime Minister George Papandreou. "Our national red line is to avoid bankruptcy," he added. The reason why the EU states quickened the rescue efforts is fear that the crisis in Greece could eventually bring down also other European countries with weaker economic systems such as Portugal and Spain. Reaction to the cuts was quite severe in Greece. "They are go! ing to worsen the recession and plunge the economy into a deep! coma," said Yannis Panagopoulus, president of million-member GSEE union. "It's time to step up the social battle, our May 5 general strike will be the beginning of a long battle."

related story (sgx17145): http://www.france24.com/en/20100502-eu-approves-greece-bailo...

by Zuzana Zelenakova for Cantell TV (http://cantell.tv)

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