Greece set to be granted 2-month bailout extension

Greece will ask today for a two-month extension to its bailout programme and which the eurozone is in favour of granting, Eurogroup chief Jeroen Dijsselbloem said yesterday.

Dijsselbloem said after the bailout ends, eurozone countries support a credit line for Greece.

“There is not enough basis at this point to conclude the review now or before the end of the year,” he said after eurozone finance ministers discussed the issue in Brussels.

“The Eurogroup would be favourable to a request by Greece of a technical extension of two months.”

The EU had been considering extending the current bailout by six months to mid-2015, a document obtained by Reuters showed last week. But Athens said it is only willing to consider extending the unpopular programme by a few weeks.

“What we really want is to reach good agreements that allow Greece to cut its deficit and carry out the right reforms that will allow it to have a solid economy,” EU Commissioner for Economics and Financial Affairs Pierre Moscovici told reporters yesterday before the meeting of eurozone finance ministers. He said he was well aware of the efforts made by Greece.

Greece’s parliament approved next year’s budget in the early hours yesterday, the plan being closest to a balanced budget Greece has produced in more than three decades. Prime Minister Antonis Samaras is struggling to push through an early exit from the bailout and ensure the survival of his government after a presidential vote next year.

A row with the EU and IMF over a disputed budget shortfall next year has held up the country’s final bailout inspection and plans to exit the aid programme. Greece’s lenders are demanding €1.7bn in extra measures to hit budget targets next year, something Athens has rejected.

Speaking ahead of the ministers’ meeting Dijsselbloem said he was “not confident at all” about the deadlines over the Greek issue.

German finance minister Wolfgang Schaeuble said Greece may need some more time before the last bailout credit tranche can be disbursed by international lenders.