The 11th-hour agreement will prevent Greece from having to abandon the eurozone. But it is also likely to be politically costly for the country’s newly elected anti-austerity government.
Greek Prime Minister Alexis Tsipras addresses lawmakers of his leftist Syriza party in the parliament Feb. 17.
Alkis Konstantinidis / Reuters
The deal was reached during a meeting of finance ministers in Brussels. It will give Greece four months of relief from the $272 billion bailout it has needed to stay afloat since the financial crisis of 2008.
The agreement still needs to be ratified by the parliaments of the creditors, but it ended concerns that Greece might be forced to abandon the euro on Feb. 28, when the bailout was originally set to expire.
Greece has been mired in a huge economic crisis for the past five years, with its economy shrinking by almost a third. Its government has needed large loans from other nations in the eurozone — particularly Germany — just to stay afloat.
But those loans have come with strings attached that have proven unpopular among Greeks. The European Commission, the European Central Bank, and the International Monetary Fund, collectively know as the troika, have demanded that Greece implement austerity measures in exchange for the loans.
The measures have included mass layoffs of government employees and a significant reduction in public services.
Friday's relief will require the new government of Prime Minister Alexis Tsipiras and his far-left Syriza party to submit a letter detailing the measures it plans to take to ensure that the country meets the creditor's demands.
That forced walk-down from electoral promises to put an end to austerity measures will likely put Tsipiras in a politically tough spot with supporters back home.
LINK: Greece’s Economy Is Screwed And Nobody Can Agree On How To Save It
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