How to read the Greek government’s latest bailout plan
Greece’s finance minister has offered a way for creditors to avoid default by extending their bailout for another six months.
Greece’s government has offered to extend its bailout for six months if creditors agree to keep the country’s debt to just 6.9% of gross domestic product (GDP).
It also said it will consider offering the same offer again to cover its deficit.
But Greece’s creditors want a longer extension, and it is unclear whether the offer will be accepted.
Greek Finance Minister Yanis Varoufakis said Tuesday that he and his colleagues were looking at a longer term extension, but it was too early to say if the offer was accepted.
The offer, which is seen as one of the most likely to be accepted by creditors, comes after Athens’ election last month and the subsequent political turmoil that followed.
Varoufakis and his allies say the extension should help the country avoid a default and prevent it from entering into a second bailout with its creditors.
The government has been pushing for an extension for a long time, saying it wants to avoid a Greek exit from the euro.
But the latest offer is seen by many as a first step in the right direction, and suggests that Varoufas government is getting closer to achieving its aim.
Varouakis has long said that his government was willing to accept any extension, if creditors agreed to keep Greece’s debt at 6.5% of GDP.
He and his team said Tuesday they were “deeply concerned” by a report by the International Monetary Fund that the Greek economy is expected to shrink by 0.2% in the first half of next year.
“We will continue to work to achieve this goal,” Varoufakis said.