After weeks of discussions, allegations and suspicion, the Eurogroup finally reached an agreement on the Greek bailout program in the evening of 20 February. It truly is a last-minute achievement – the program was originally set to end on 28 February and without any follow-up arrangement, Greece would quickly run out of money and even be forced to leave the euro. Also, worried Greeks have been taking their deposits away from Greek banks, which seriously threatens the overall stability of the banking system. Without a deal, the outflow of capital could have led to collapse.
The Eurogroup agreed to extend the current bailout program by 4 months, giving the new Greek government of Alexis Tsipras more time to prepare a follow-up solution. Greece is still not ready to function fully without any sort of financial assistance. On Monday 23 February, Greece must present a list of reforms it will undertake. The list will be assessed by the Troika institutions (EC, ECB, IMF). If the three institutions are satisfied, the program will formally be prolonged. Also, negotiations on the final list of reforms will start, with the aim to agree on a final list of reforms by the end of April. Based on these new arrangements, the review process will be carried out and, upon its satisfactory completion, Greece will receive the badly needed last bailout tranche. Greece also declared that it will honor all of its financial commitments and will refrain from any unilateral steps, such as rollback on reforms already in place.
5th May 2021