Reuters: Greek finance minister says eurozone, IMF mull two-year extension for Greek bailout

08 October 2012

Greek Finance Minister Yannis Stournaras said that international lenders are considering giving Greece two more years to reach its budget deficit reduction targets, and the extra time could be financed without more money from the eurozone.

"It is now on the table by all members of the troika", Stournaras said of the two-year extension. "All the exercises that we are doing now they assume that the programme will last up to 2016, that ... 4.5 per cent of GDP for the budget deficit will be achieved in 2016 rather than in 2014", he said. "The implicit assumption is that the programme will be extended, despite the fact that it remains extremely frontloaded."

Extending the programme by two years would create a funding gap of about €12 billion, which could be covered by €8 billion the International Monetary Fund had set aside in case of a deeper than expected recession.

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