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Europe hopeful on Greek bailout

Tuesday, February 21, 2012 - 02:27

Feb. 21 - Euro zone finance ministers reconvene after securing a second rescue package for Greece to avoid a disorderly default. Ciara Sutton reports.

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It was a test of their stamina After agreeing a second 130 billion euro bailout for Greece in the early hours of the morning euro zone finance ministers were back for more talks. But the main agreement had been reached. And French Finance Minister Francois Baroin said he was satisfied with the outcome. (SOUNDBITE) (French) FRENCH FINANCE MINISTER FRANCOIS BAROIN SAYING: "It allows us to share the burden equally among the European part and the Greek part, between the public sector and the private sector. It is a really good agreement, because we reached targets we set previously, perhaps it is even better than we could have imagined when we arrived at this meeting." Private sector holders of Greek debt will take slightly higher losses on the value of their bonds. But German Finance Minister Wolfgang Schaeuble says the new programme will help get Greece back on the right track. (SOUNDBITE) (German) GERMAN FINANCE MINISTER WOLFGANG SCHAEUBLE SAYING: "We agreed a haircut of 53.5 percent and the coupon for the new bonds will start at about 2 percent, rising to 3 percent and then 4.3 percent after 2020." To lighten Athens' debt burden, the ECB will give up the profits it's made from buying Greek bonds over the past two years. But ECB President Mario Draghi says there are conditions. SOUNDBITE) (English) EUROPEAN CENTRAL BANK PRESIDENT MARIO DRAGHI SAYING: "It is very important that all major political forces in Greece own this programme. They stand behind the commitments that have been taken by the Prime Minister and Finance Ministers tonight, and lastly it is also very, very important the programme and its implementation be rightly monitored." That prospect hasn't gone down well in Greece. But Prime Minister Lucas Papademos called the deal "positive." (SOUNDBITE) (English) GREEK PRIME MINISTER LUCAS PAPADEMOS SAYING: "We worked very hard in order to adopt the new economic programme that was agreed with the Troika and that was formally approved today. And the agreement on the PSI which has been the subject of extensive negotiations over the past two months, this agreement was finalised." The bailout will save Greece from a chaotic default in March. It's also designed to cut it's debt to 120.5 percent of GDP by 2020. But many still doubt whether it will do more than deal with its immediate debt problems. Ciara Sutton, Reuters

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Europe hopeful on Greek bailout

Tuesday, February 21, 2012 - 02:27