Wednesday, March 14, 2012

Greek cabinet formally approves bailout agreement

Greece's cabinet unanimously approved the terms of its international bailout on Wednesday, hours after euro zone countries formally approved the 130 billion euro ($169 billion) financial package that Athens needs to stay afloat.

The deal to keep Greece funded until 2014 will now be sent for approval to the Greek parliament, which is expected to vote on it by the end of the month.

The bailout ends months of uncertainty for debt-stricken Greece, which secured the package only after agreeing to a series of painful austerity measures and a successful debt swap that imposed losses of as much as 74 percent on bondholders.

"A lot remains to be done," the country's technocrat Prime Minister Lucas Papademos told the cabinet, according to a statement, adding that parliament needs to pass an additional eight bills linked to the bailout deal.

"The cabinet and parliament must undertake a great effort to complete this legislation in the coming weeks," he said.

The Greek cabinet backed the terms tied to bailout funds it will receive from the European Union. The International Monetary Fund is expected to approve its share of the bailout, set at 28 billion euros, later this month.

Papademos has said he would step down once the legislation is completed, paving the way for general elections, which are widely expected to be held at the end of April or early May.

Greece's cabinet also approved a fiscal pact agreed by EU leaders earlier this month. It is not clear yet whether parliament will also have to ratify the deal.