Eurozone unblocks €10.3bn bailout funds for Greece

May 25, 2016, 3:23 AM EDT
European Union flag
(Source: Justus Blümer/flickr)

Two days after the Greek parliament passed a package of budget cuts and tax hikes, Eurozone finance ministers decided to release a bailout loan of 10.3bn euros for the country.

In an 11-hour meeting in Brussels, the ministers agreed to “progressively” extend debt relief aimed at reviving Greece’s recession-hit economy, one of the key demands made by the International Monetary Fund (I.M.F.).

Eurogroup President Jeroen Dijsselbloem termed the development as a “major breakthrough” in offering a systematic financial assistance to Greece, writes the BBC. A majority of Eurozone ministers appreciated the austerity measures adopted by the country in recent times.

Poul M. Thomsen, Director of the I.M.F.'s European Department, said he appreciated that the Eurozone ministers identified the need for easing Greece’s debt burden, which accounts for 180 percent of the country’s gross domestic product.

The release of bailout funds will be split into two payments, with €7.5bn to be paid in June and €2.8bn in September, writes The Guardian. The I.M.F “watered down” its demand of “upfront and unconditional” debt relief for Greece and agreed to a package of debt measures that provide for phased relief.

Germany, which maintained that the debt relief should be provided only after the end of Greece’s current €86bn bailout program in mid-2018, has been at odds with I.M.F. that has been calling for immediate debt relief measures.