ATHENS: The Greek parliament approved Thursday a law on a historic 107-billion-euro debt writedown with private creditors, a key element in a new eurozone bailout designed to avoid default.
The law sets rules and procedures for the debt restructuring and opens the way for parliament to take up legislation on further austerity cuts and tough targets required to get another 130 billion euros ($172 billion) in loans by 2014.
The vote on the private sector debt restructuring was not in doubt as the two coalition government partners, the Socialists in PASOK and the conservative New Democracy party, have 193 of 300 seats in parliament.
During a six-hour long parliamentary debate, Finance Minister Evangelos Venizelos urged unity as a way to "regain our pride and confidence of the markets."
The law details terms of the so-called Private Sector Involvement (PSI) accord, agreed during the marathon talks in Brussels.
The government hopes that 66 percent of private creditors will sign up to the bond swap deal, allowing Athens to impose a Collective Action Clause ( CAC) to force hold-outs to accept the swap and losses as well.
Venizelos said an official offer to creditors had to be made by Friday, so a debt swap could be concluded by March 12 for maturities governed by Greek law, and by early April for debt issued under English and Japanese law.
In the immediate term, the rescue package should be enough to avert a default by enabling Greece to repay maturing debt worth 14.43 billion euros due on March 20.
Athens has until the end of February to approve more than three billion euros in additional spending cuts and amend the constitution to ensure that debt repayments take priority over other government commitments -- as demanded by the eurozone finance ministers.
indiatimes.com
The law sets rules and procedures for the debt restructuring and opens the way for parliament to take up legislation on further austerity cuts and tough targets required to get another 130 billion euros ($172 billion) in loans by 2014.
The vote on the private sector debt restructuring was not in doubt as the two coalition government partners, the Socialists in PASOK and the conservative New Democracy party, have 193 of 300 seats in parliament.
During a six-hour long parliamentary debate, Finance Minister Evangelos Venizelos urged unity as a way to "regain our pride and confidence of the markets."
The law details terms of the so-called Private Sector Involvement (PSI) accord, agreed during the marathon talks in Brussels.
The government hopes that 66 percent of private creditors will sign up to the bond swap deal, allowing Athens to impose a Collective Action Clause ( CAC) to force hold-outs to accept the swap and losses as well.
Venizelos said an official offer to creditors had to be made by Friday, so a debt swap could be concluded by March 12 for maturities governed by Greek law, and by early April for debt issued under English and Japanese law.
In the immediate term, the rescue package should be enough to avert a default by enabling Greece to repay maturing debt worth 14.43 billion euros due on March 20.
Athens has until the end of February to approve more than three billion euros in additional spending cuts and amend the constitution to ensure that debt repayments take priority over other government commitments -- as demanded by the eurozone finance ministers.
indiatimes.com
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