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Greece Economic Crisis Declared Over: It Isn't

•, by Mike Mish Shedlock

RTE says Greece Crisis Declared 'Over' as Eurozone Agrees on Debt Relief

The BBC says Greece Hails 'Historic' Debt Relief Deal

The Financial Times says EU Commissioner Calls End to Greek Crisis

Can-Kicking Deal

This was another can-kicking announcement according to Eurointelligence.

Here it is. Finally, a deal on debt relief for Greece. It is a fudge of sorts, but a deal that ends the eight-year-long Greek debt crisis - for now. These are the main components of the deal:

A €15bn loan disbursement at the end of the programme, of which €3.3bn can be used to buy back IMF loans;

A 10-year extension of the EFSF loans, and a ten-year deferral of interest payments and amortization starting from 2033; and

A return of profits from Greek bonds (SMP and ANFA) held by Eurozone central banks, a total of €4bn, with semi-annual payments and subject to reform targets.

There is no growth clause, no interest-rate cuts, no major buyback programme. This is not debt relief in the way the IMF defines it, but debt relief of the kicking-the-can-the-road variety.

It also leaves Greece with a significant exposure to IMF loans. Even if Greece were to use the €3.3bn to buy back IMF loans, that still leaves €7.1bn to be repaid by 2024.

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