Experts have criticised the
eurozone’s rescue package for Greece,
saying the move will do little to address the country’s core budget deficit
Moreover, the failure of Greece to take responsibility for its state
finances could threaten the future enlargement of the eurozone and the
ambitions of potential members such as the Czech Republic.
“I am not in a hurry to open
the champagne. It is not time to celebrate,” said Aleš Michl, an analyst
“It’s like this. If you gave
me 1 million today, I would be lucky, but next year I would face the same problem.”
The package is only a short-term
liquidity solution, Michl added, but won’t change the fact Greece has
longstanding solvency problems and has put itself near bankruptcy.
Finance Chief Finance ministers
from the 16 countries in the eurozone finalized details on an up to 30 billion
euro bailout package for Greece
The ministers also hashed out
details on the rate at which eurozone members would lend money. The interest
rate is expected to be 5 percent, well below market rates and welcome news for
the debt-ridden country, which was unable to find rates below 7 percent
The International Monetary Fund
will also contribute to the fund, though the amount is yet to be finalised. The
IMF loan is expected to be between 10 billion and 15 billion euros
“It is a poor solution,”
he said. “There will be more debt, and Greece’s debt levels will
The agreement, announced 11 April,
will see the 16 countries of the eurozone offer up to 30 billion euros in aid
at an interest rate of 5 percent if the country can’t raise enough on capital
markets to pay off debts. As part of the deal, the International Monetary Fund
will also provide funding between 10 billion and 15 billion euros.
Some observers note the move was a
necessary step to stabilize shaky financial markets.