Greek Bailout Talks See Progress

Greek Bailout Talks See Progress

BRUSSELS (AP) -- The eurozone's top official says "significant progress" has been made between Greece and its creditors over the release of bailout loans that will ensure the country avoids going bankrupt this summer.

"The big blocks have now been sorted out and that should allow us to speed up and go for the final stretch," Jeroen Dijsselbloem told reporters Friday following a meeting of the eurozone's 19 finance ministers in the Maltese capital of Valletta.

Once a broad agreement is reached in coming weeks, Dijsselbloem said the eurozone will come back to issues related to Greece's stringent medium-term budget targets and the country's debts — key conditions of the Greek government.

EU Commission Vice-President Valdis Dombrovskis said that a deal on the latest steps to keep Greece afloat should be within reach by the time the eurozone ministers meet again on May 22.

Greece is seeking to get an agreement so its next batch of bailout funds can be released so it can make upcoming debt repayments, avoid bankruptcy and a possible exit from the single currency bloc.

Without the loan, Greece would struggle to make a debt payment in July, raising anew the prospect of default. The last time, Greece faced potential bankruptcy was in July 2015, when the Tsipras government eventually agreed a three-year bailout that could amount to 86 billion euros ($91 billion).

Greek Prime Minister Alexis Tsipras said earlier this week that if a breakthrough on plans to pay Athens the next installment fails to materialize over coming days, then the eurozone should hold a special meeting of leaders.

Friday's developments appear to have put paid to that threat.

Tsipras had blamed unnamed negotiators among Greece's European creditors and the International Monetary Fund for "moving the goalposts" each time Greece was close to meeting approval conditions for the bailout.

Even Wolfgang Schaeuble, the German finance minister who has been one of Greece's sharpest critics over the past few years, said he didn't expect any major hitches ahead. "The longest distance is behind us," he said.

As part of its third international bailout agreement, Greece has to make a series of sweeping reforms to its economy in return for the loans. But the talks have dragged on for months, freezing the latest loan payout and hurting the chances of a self-sustaining Greek economic recovery after years of recession and turmoil.

Tsipras' left-led government is pushing for a comprehensive deal that would cover more than just spending cuts and reforms by Greece, but also alleviate the country's debt burden and pave the way for its return to international bond markets later this year.

Greece has depended on international bailouts since 2010 after it was unable to borrow on international bond markets.

To receive the money, successive governments slashed incomes, hiked taxes and implemented market reforms. Though helping to put the public finances on a surer footing, the measures came at a cost — the Greek economy lost a quarter of its output.

Dijsselbloem conceded that the failure to agree the release of the next batch of bailout funds had harmed Greece's economic recovery in recent months.

"That momentum is slipping away from us so we really need to work fast and have it done certainly well in time for the next payments Greece has to make," Dijsselbloem said.

Currently demanded cutbacks include new pension cuts, a broadening of the tax base, labor reforms and privatizations. These will require approval by Greece's parliament, where Tsipras holds a three-seat majority.

(KA)