Greek rescue package faces further hurdles

Two of the eurozone’s key creditor countries, Austria and the Netherlands, said on the 18 August 2011 that their backing for Greek bail-out loans may be contingent on securing concrete collateral from Athens, a move that would create fresh hurdles to the new €109bn Greek rescue that may be difficult to surmount.

The announcements by Austria and the Netherlands, two of the eurozone’s six triple A rated members, followed a tentative deal reached on 16 August 2011 between Athens and Finland, another triple A eurozone country which for months has demanded collateral in return for its support for the bail-out.

The Greek bail-out deal reached in July 2011 allowed for such bilateral agreements as a way to placate the Finnish government. Senior eurozone finance ministry officials started a two-day meeting to review the deal in Brussels on the 18 August 2011.

On the 20 August 2011 Greek Finance Minister Evangelos Venizelos called for the EU to step in and display a united European front following the flurry of demands by several eurozone states that Athens provide collateral in exchange for their contributions to a multi-billion-euro loan package.

ESO: Background information: Dutch disquiet brews over Greek rescue http://www.europeansources.info/record/dutch-disquiet-brews-over-greek-rescue/

ESO: Background information: Meeting of Heads of State or Government of the Euro area, Brussels, 21 July 2011: EU leaders agree €109bn Greek bail-out http://www.europeansources.info/record/meeting-of-heads-of-state-or-government-of-the-euro-area-brussels-21-july-2011-eu-leaders-agree-e109bn-greek-bail-out/

ESO: Background information: Finns talk tough on aid for Greece http://www.europeansources.info/record/banks-to-meet-to-sweeten-greek-terms-finns-talk-tough-on-aid-for-greece/

ESO: Background information: Blaming the Periphery. Right-Wing Populists Stoke Anti-Southern Rage http://www.europeansources.info/record/blaming-the-periphery-right-wing-populists-stoke-anti-southern-rage/

Helsingin Sanomat, 18.8.11: Finland: No compromise on Greek collateral issue http://www.hs.fi/english/article/Finland+No+compromise+on+Greek+collateral+issue/1135268634478

Kathimerini, 18.8.11: Four more eurozone countries ask Greece for collateral http://www.ekathimerini.com/4dcgi/_w_articles_wsite1_32310_18/08/2011_402779

Kathimerini, 21.8.11: Minister asks top EU officials for mediation http://www.ekathimerini.com/4dcgi/_w_articles_wsite1_1_21/08/2011_403036

EUObserver, 19.8.11: Finland puts Greek bailout package under pressure http://euobserver.com/19/113349

De Volkskrant, 19.8.11: Finland destabilizes bailout plan (via PressEurop) http://www.presseurop.eu/en/content/news-brief-cover/869981-finland-destabilizes-bailout-plan

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