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Euro zone unblocks short-term debt relief for Greece

Reuters

BRUSSELS (Reuters) - Euro zone governments unblocked short-term debt relief measures for Greece on January 20, the euro zone bailout fund ESM said in a statement on Monday, paving the way for a reduction of the country's debt-to-GDP ratio and its gross financing needs.

The European Stability Mechanism suspended the measures last December, after Athens raised concerns it would not stick to its bailout commitments by paying out a Christmas bonus for pensioners and keeping a lower value added tax on some islands.

"The measures approved by the governing bodies... are an important step toward improving Greek debt sustainability," the bailout fund head Klaus Regling said in a statement.

"We estimate that when implemented in full, they should lead to a cumulative reduction of Greece’s debt-to-GDP ratio of around 20 percentage points until 2060," he said.

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"We also expect Greece’s gross financing needs to fall by almost five percentage points in the same time horizon," he said.

(Reporting By Jan Strupczewski)

 
 
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