Sun, Sep 16, 2012 - Page 13 News List

Greece in need of aid extension: PM


Greece needs a two-year extension from its international creditors to meet fiscal pledges, and a liquidity boost from the European Central Bank (ECB), Greek Prime Minister Antonis Samaras said.

In a Washington Post interview which appeared in Greece yesterday, Samaras said the recession-hit country was determined to adopt a new austerity package worth 11.7 billion euros (US$15 billion) to avoid leaving the eurozone.

However, he said the program should apply over four years instead of the currently agreed timeframe of two years — his most specific extension request in weeks.

“Instead of the 11.7 billion euro package taking place over two years, it would be best if it were to take place over four years,” the prime minister said.

Samaras had asked for a two-year extension prior to his election in June, but had since made more general requests for “breathing space” in meetings with EU leaders over the last month.

Eurozone and IMF leaders meeting in Nicosia on Friday also conceded that Greece needed more time to meet agreed targets under its international bailout.

“Clearly timing is an issue worth consideration,” IMF managing director Christine Lagarde told a news conference.

With EU decisions on Greece now expected at a summit on Oct. 18 and 19, Greek Finance Minister Yannis Stournaras said in Nicosia that officials had 10 days to seal the disputed package of cuts pending since June.

“[Measures worth] four billion euros have yet to be agreed, but this matter will be settled soon,” he said, according to the paper.

Greece must agree with its so-called “troika” of creditors — the EU, IMF and the ECB — to receive the next slice of 31 billion euros from its bailout package.

In his interview, Samaras said the money was needed to recapitalize Greek banks and pay more than US$6 billion that the state owes to the private sector.

And with Greece excluded from borrowing on financial markets, the prime minister said the country needed to get liquidity through the ECB.

“The ECB provides liquidity, either through bonds or through the Emergency Liquidity Assistance program,” Samaras said.

“Other countries have access to the markets, whereas Greece does not. Therefore, we have to get liquidity through the ECB,” he said.

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