Greece receives last bailout tranche as crisis nears end

Vastavam web: Greece today received the final 15-billion-euro payment from its eight-year bailout programme in what creditors hailed as proof that tough austerity measures were “paying off.” The payout by the European Stability Mechanism (ESM), the eurozone’s bailout fund, comes ahead of the formal end on August 20 of Greece’s third financial rescue package since 2010.

The cash landed after Eurozone finance ministers in June reached what Greek Prime Minister Alexis Tsipras called a “historic” deal to end the severe debt crisis that has weighed down the country for years.Regling said the final set of reforms agreed by Greece in exchange for the last payout “included important actions in the field of tax policy, combatting tax evasion, public revenue reforms, and the resolution of non-performing loans.” In total 9.5 billion euros (USD 11 billion) of the tranche will be used to build up Greece’s cash safety cushion to a hefty 24 billion euros 22 months of Greece’s financing needs after the bailout ends — according to the ESM.Greece’s public finances spun out of control in 2010, sparking three international bailouts — the last was in 2015 — and threatening the country’s membership of the euro single currency.

In return Athens had to bow to harsh terms imposed by its creditors, especially Germany, with austerity measures and reforms striking at the heart of Greece’s bloated public sector.The deal was expected to be an easy one, but last-minute resistance by Germany Greece’s longtime bailout nemesis and biggest creditor dragged the talks on for six hours.”The end of the ESM programme on 20 August will be a milestone for the country.Greece will now have to prove to its partners and the markets that it is committed to not reversing past reforms,” Regling said.