Germany Press: Greece Might Soon Need Third Bailout Program

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BERLIN (MNI) – Greece might soon need a third financial aid program
from its Eurozone peers, the German weekly Die Zeit reported Wednesday,
citing unnamed financial and government sources.

As Greece has fallen behind the goals of the consolidation and
reform program agreed with the EU and the IMF, especially regarding tax
revenue and privatisation proceeds, discussions are underway in the EU
to give the country more time to reduce its deficit, the paper said.

In order to extend the deficit-reduction timetable, Greece would
need tens of billions more in aid, Die Zeit said. The German parliament
might already have to deliberate on a new program this summer.

Eurozone officials have told MNI that if the new Greek government
shows sincere commitment, “some adjustments could be made to the bailout
program.”

The sharp deterioration in the country’s growth outlook leaves room
to extend the period for the consolidation effort, one source noted. The
working scenario has been for an extension of two years, which means
Greece would have to bring its deficit down to 3% of GDP by 2016 instead
of 2014, the official said.

“It is a well known secret in Brussels that the E130 billion second
bailout program won’t be enough,” another source said

–Berlin bureau: +49-30-22 62 05 80; email: twidder@marketnews.com

[TOPICS: M$X$$$,MGX$$$,M$$CR$,M$Y$$$,M$G$$$]

2012-06-13T12:50:01+0000

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