Greece planning to seek loan agreement extension

[webfact]

Greece planning to seek loan agreement extension
DEREK GATOPOULOS, Associated Press
ELENA BECATOROS, Associated Press

ATHENS, Greece (AP) — Greece is considering requesting an extension to its loan agreement, government officials said Tuesday, in an effort to reach a last-minute deal with the country's European creditors and avoid the danger of a euro exit.

The country would submit the request before Friday, said the officials, who spoke on condition of anonymity pending the formal announcement. They stressed the request would not be for an extension of Greece's bailout agreement, which includes strict cost-cutting measures as conditions for rescue loans.

The move follows an ultimatum issued by eurozone finance ministers after their meeting to find a solution for Greece collapsed Monday night. They have said Greece must ask for an extension to its current bailout by the end of the week in order to reconvene a meeting.

It was unclear whether the Greek request would meet the requirements of the country's creditors, but the news was greeted with some market optimism.

U.S. stocks moved slightly higher, and the euro also gained some lost ground against the dollar.

"Greece's new government wants more independence, but it doesn't want that independence at all costs," said Anastasia Amoroso, a global market strategist at JPMorgan Funds. "The extension is good news because it buys Greece and the eurozone time to reach a long-term resolution."

Greece's new left-wing government won elections last month on a promise to renegotiate the country's bailout agreement. That deal provided 240 billion euros in rescue loans from other EU countries and the International Monetary Fund, but came on the condition that Athens imposed draconian austerity measures in return.

Time is running out for the two sides to reach an agreement. The European part of Greece's bailout program expires on Feb. 28, after which the country will struggle to service its debts.

Earlier Tuesday, Prime Minister Alexis Tsipras sounded a defiant note, saying Greece will not compromise in talks with its European creditors, but that it is working for an "honest and mutually beneficial agreement."

The failure in Monday's meeting of eurozone finance ministers has increased fears Greece may be forced out of the joint euro currency, although investors seem to believe the two sides will eventually reach an agreement.

Athens insists it cannot ask for the continuation of a program it considers wrong. Instead, it has asked for a "bridging agreement" that would ensure it doesn't face any cash liquidity problems while it negotiates a new deal.

"Salvation will not come by extending the mistake," Tsipras said during a speech to his party lawmakers in parliament.

"We are not hurrying and we are not compromising," he said. "We are, however, working hard for an honorable and mutually beneficial agreement — an agreement without austerity and the bailout agreement that destroyed Greece in these past years."

Anything else, the prime minister said, "is not an agreement but a surrender that would complete the euthanasia of our country."

Germany, the largest single contributor to the Greek bailout, has been most vocal in insisting Greece stick to its commitments.

German Finance Minister Wolfgang Schaeuble, speaking in Brussels, said it was unclear what Greece wanted.

"A lot of colleagues were asking: 'What do they really want? Do they have a plan?'" Schaeuble said, adding: "I don't know."

Investors are not panicking despite the breakdown in talks. European stocks were steady, while the Athens index fell 2.5 percent. Greece's government borrowing rates rose, however, a sign investors are more wary of a potential bankruptcy.
____

AP Business Writer Ken Sweet in New York and AP writer Raf Casert in Brussels contributed.


-- (c) Associated Press 2015-02-18

[Anthony5]

Greece is considering requesting an extension to its loan agreement, government officials said Tuesday, in an effort to reach a last-minute deal with the country's European creditors and avoid the danger of a euro exit.

The country would submit the request before Friday, said the officials, who spoke on condition of anonymity pending the formal announcement. They stressed the request would not be for an extension of Greece's bailout agreement, which includes strict cost-cutting measures as conditions for rescue loans.

The move follows an ultimatum issued by eurozone finance ministers after their meeting to find a solution for Greece collapsed Monday night. They have said Greece must ask for an extension to its current bailout by the end of the week in order to reconvene a meeting.

Someone can explain to me how the news can be considered positive?

[wabothai]

I feel very sorry for the hardworking simple Creek folks. They did not ask for this, allthough they voted.

They were bullied by corrupt hisos, who stole from the country and ought to be brought to justice.

No merci however from the simple hard working other European folks.

[petermik]

Sorry but who are "Creek hosts" are you refering to the people that live on Crete or Kriti

p.s. if they had paid their dues and demands over the years maybe they wouldn,t be in this mess now

[Lupatria]

Your pension is safe Costas! Throw some plates for the Germans but don't cheat remove the Flokati before.

Edited February 18, 2015 by Lupatria

[Srikcir]

"the request would not be for an extension of Greece's bailout agreement"

aka, Greece BLINKS in debt negotiations. But word games will not satisfy the EU debt.

This request is for extension of the loan agreement and will not result in additional funds, ie., a bailout. EU has indicated previously it would consider changing the loan term to perpetuity and debt service tied to Greece's GDP. But there would be no cancellation or forgiveness of debt nor additional debt. But the request wants a 6-month freeze on the loan while negotiations are conducted. DOA

Greek citizens gambled on electing this new government to save them from making austere decisions. It will fundamentally fail and there will be another new government within a month.