A final statement, released hours after night-long negotiations at the Euro Summit, confirmed that the Greek authorities have agreed to introduce tough reforms in exchange for a three-year bailout worth up to 86 billion euros.
Here are the main points of the statement:
1) The Greek parliament has until July 15 to pass measures to streamline VAT (value-added tax) rates, widen the tax base, trim pensions and ensure “full legal independence” of the country’s national statistics agency.
2) The debt would not be reduced or written off. But it might be restructured once Greece has implemented all of its promised reforms.
3) Greece would have to draft a timetable detailing measures to: conduct product market reforms, privatize the electricity transmission network, eliminate political interference and overhaul non-performing loans.
4) The country will receive short-term “bridge financing” to avoid insolvency. According to some calculations, Greece needs nearly 7 billion euros ($7.7 billion) over the next month to continue to pay off its debts.
5) A key point is the foundation of a 50 billion euro asset fund. Half of this will be used for the recapitalization of Greek banks, while the other half will be directed to investments and to reduction of the country’s debt and Greece's debt mountain - by means of “privatizations and other means.”
6) Most of the loan would come from the European Stability Mechanism (ESM) - the eurozone’s bailout fund. However, the International Monetary Fund (IMF) will also be asked to contribute from March 2016, when its current bailout program ends.
7) The European Commission would try to mobilize up to 35 billion euros - outside of the ESM loan - to fund investment and boost economic activity in Greece.
8) National parliaments will need to ratify the final agreement - which is likely to happen before the end of the week.
