Entries in Bailout (5)


Greece Passes Austerity Measures to Get $170 Billion Bailout

iStockphoto/Thinkstock(ATHENS, Greece) -- Greek demonstrators ran amuck through Athens on Sunday after Parliament passed unprecedented austerity measures to keep the country's government from default.

By a vote of 199-74, the members voted in favor of the plan that frees up $170 billion in bailout money from the European Commission, the European Central Bank and the International Monetary Fund.

Sunday's vote followed Prime Minister Lucas Papademos exhorting lawmakers to look at both sides of the issue and make the tough decision to avoid bankruptcy, or otherwise send the world economy into another recession since nearly all the money Greece has operated on for decades has came from foreign sources.

With the new austerity, Papademos also acknowledged the pain of the Greek people and the plan that "calls for sacrifices from a broad range of citizens who have already made sacrifices."

As lawmakers made their tough choice, Athens burned with thousands taking to the street to vandalize or loot stores and businesses.  Many feel that life as they have known it will change forever as half the workers are employed by the government, receiving a pension of 95 percent of their salary upon retirement.

The trio of foreign lenders is also making huge sacrifices to keep Greece propped up, writing off 70 percent of what Greece owes European banks in exchange for the government imposing higher taxes and deep cuts in social services.

Among the reductions Greeks can expect is the minimum wage slashed from 750 Euros to 500 Euros a month.  Unemployment, currently at 20 percent, can expect to rise with planned layoffs in the civil servants sector.

If Greece defaults on its debts, which are owned by European banks, it would cause a recession, making it far more difficult to get loans.  It would also limit U.S. exports, which would also affect the American economy.

Copyright 2012 ABC News Radio


Greek PM Holds Emergency Cabinet Meeting amidst Resignation Calls

Chip Somodevilla/Getty Images(ATHENS, Greee) -- An emergency Cabinet meeting is underway in Greece as calls for Prime Minister George Papandreou's resignation intensified on Sunday.

Facing a financial crisis, Papandreou says he wants to form a new coalition government before he steps down. Opposition leader Antonis Samaras of the New Democratic Party said the prime minister should resign immediately and it is unclear whether Samaras will attend the emergency meeting to which he was invited.

As the nation's financial woes worsen, so has Papandreou's prospects of completing his four-year term. Greece received a $150 billion bailout in 2010 from the European Union and is set to receive additional funding before the end of the year from the eurozone.

Copyright 2011 ABC News Radio


Greek Cabinet Approves Referendum on Bailout Package

iStockphoto/Thinkstock(ATHENS, Greece) --  With a unanimous vote, the Greek cabinet has decided to move forward with an immediate referendum on the bailout plan for the country.

Although the vote was unanimous, some Greek lawmakers expressed opposition to the vote. The prime minister of Greece, George Papandreou, called for the referendum at the last minute, seeking the public's approval for the rescue package eurozone leaders agreed upon at last week's summit in Brussels.  

Papandreou's call for a referendum caused Tuesday stocks in U.S. and European markets to plummet. A negative vote would likely send Europe into a depression, and have a heavy impact on the global economy.

One official says the referendum will likely happen before Christmas, according to The Wall Street Journal.

Copyright 2011 ABC News Radio


Eurozone Strikes Greek Bailout Deal

Stockbyte/Thinkstock(BRUSSELS, Belgium) -- The eurozone leaders and the IMF on Thursday agreed on a second bailout worth $155 billion, debt restructuring and an expansion of the European bailout fund. Banks and other private investors will contribute an additional $53 billion to the rescue package.

According to analysts, this deal makes it likely that Greece will become the first Western-developed world country to default in more than 60 years, as all three main rating agencies are expected to determine that Greece has defaulted because bondholders will suffer losses.

The deal, which was struck at an emergency summit in Brussels Thursday, will also lighten the load for Ireland.  It will allow for a two-percent reduction in the Irish Republic's interest payment, according to BBC News.  Irish Prime Minister Enda Kenny says the reduction could save Ireland 600-800 million euros a year.

Though the bailout deal will include non-government lenders Greece, French President Nicolas Sarkozy said private sector involvement would be excluded regarding Ireland and Portugal, BBC News reports.  Both countries are also receiving European aid.

Copyright 2011 ABC News Radio


Irish Government to Make $114-Billion Bailout for Bank of Ireland

Photo Courtesy - Getty Images(DUBLIN) -- The Irish government will take a majority stake in the Bank of Ireland as part of the massive €85 billion ($114 billion) bailout being worked out by the European Union and the International Monetary Fund, according to The Financial Times.  This move means that all major lenders in Ireland would have the government as their largest shareholder.
The Euro currency trade, as well as Asian and European markets, will likely react to the news overnight.
Fears persist that Spain and Portugal are next in line to need a bailout, and that the entire eurozone could be facing a deepening crisis.
The Irish bailout amounts to about 15 percent of the $700-billion U.S. bailout, for a country with a population about that of Chicago and Houston combined.

Copyright 2010 ABC News Radio

ABC News Radio