Dei Zeit: Eurozone offers Greece an extension
Breaking News: German newspaper Die Zeit is reporting tonight that the eurozone is proposing extending Greece’s current bailout until the end of the year.
According to Die Ziet’s story, Greece would receive €10bn of cash which is currently set aside to recapitalise the Greek banking sector.
The ECB would also raise the cap on Greek banks, allowing them to buy another €2bn of government debt.
Together, this would allow
Greece to meet its repayments to the IMF and the ECB this summer.
It is billed as a “final offer” to Greece to avoid bankruptcy.
The IMF wouldn’t be involved in the plan -- understandable, given its concerns that Greece’s debt burden is now unsustainable, meaning debt relief is needed.
So, it sounds like the short-term can-kicking offer that some analysts had expected. There has been speculation that the bank recapitalisation money could be used in this way.
But a word of caution -- it is not clear what conditions Greece would have to agree to.