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Billions in Debt Relief and Recovery Aid for Greece

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Greece can expect a lot of European money in the coming months. The Eurogroup has agreed in Luxembourg with a new debt relief of 748 million euros, while the European Commission already approved the Greek recovery plan earlier Thursday.

 

The recovery plan gives the country access to €17.8 billion in EU grants and €12.7 billion in favourable loans from the 672.5 billion corona recovery fund for all 27 member states.

It is the fifth time that Greece has received debt relief since it withdrew from the European emergency program in August 2018. The country had fallen into a financial crisis in 2010 and kept going for years by the EU and the International Monetary Fund. In exchange for the billions in support, Greece had to make huge cutbacks and implement reforms in, among other things, the tax system and the labour market. “Despite the corona crisis, the country still keeps to the agreements, and the reforms continue,” said European Commissioner Paolo Gentiloni (Finance).

“That money arises from earlier agreements,” explains outgoing minister Wopke Hoekstra (Finance). In 2012, the Netherlands and the other euro countries came to the rescue with the purchase of Greek government bonds. The profits they have made will be transferred to Athens semi-annually until mid-2022 to help alleviate the debt burden. The condition is that the agreements on reforms and cutbacks are complied with. This concerns a total package of 4.8 billion euros. The money is used to reduce interest charges and to repay loans early.

Greece is also one of the first countries to have the recovery plan approved by the commission, after Spain and Portugal. European Commission President Ursula von der Leyen personally delivered the approved assessment to Prime Minister Kyriakos Mitsotakis in Athens. “The plan is ambitious and will help build a better future for the Greek people,” she said.

The country focuses on cleaner public transport and wants to make more than 100,000 homes energy-efficient for 1.3 billion euros. There will be more than 8,000 charging points for electric cars. Government services will continue to be digitized, and money will be allocated to boost the population’s internet skills.

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