Eurogroup, Greeks Reach Agreement On A Bailout Plan

Transcript

RENEE MONTAGNE, HOST:

All-night negotiations between European leaders and Greece ended this Monday morning with this announcement by European Council President Donald Tusk.

(SOUNDBITE OF ARCHIVED RECORDING)

DONALD TUSK: Today, we had only one objective - to reach an agreement. We have finally reached it. Someone can say that we have an aGreekment (ph).

MONTAGNE: A moment of humor after so much pain and effort. This new bailout agreement with Greece should save it from financial collapse. We go now to NPR's Soraya Sarhaddi Nelson in Brussels where the agreement was reached. Good morning.

SORAYA SARHADDI NELSON, BYLINE: Good morning, Renee.

MONTAGNE: Break down for us what the Europeans and Greece have come up with.

NELSON: Well, the document states in principle that negotiations will start for an actual bailout once this whole flurry of conditions are met. For one, the Greek Parliament tomorrow or Wednesday has to approve not only this agreement, but they have to legislate things they have already agreed to, for example, value-added tax hikes and pension cuts. And there are also demands for the Greeks to strengthen reforms and product markets and the labor markets. But - last but not least, they're talking about $55 billion in Greek assets that will be set aside and possibly sold in order to stabilize banks to ensure that they have more assets. That money will also be used to pay creditors, and what's left will be given to the Greeks to invest in their economy. It's a really tough deal, and it's a lot tougher than what was originally on the table several months ago.

MONTAGNE: Well, Soraya, take us back for a moment and remind us how this saga played out and why it was so difficult for these leaders to reach a deal.

NELSON: Well, it comes down to one word, and that is trust. There was none anymore. I mean, basically, the Greek government that came into power earlier this year was just resisting anything that the eurozone leaders or that its eurozone partners were putting down as conditions for the bailout. They said, you know, we've suffered enough, and it's time that we do things to stabilize the country and to promote growth, to stimulate growth.

But the - on the other hand, the eurozone leaders and the critics that were basically led by Germany were saying, you and Greece have never really maintained your pledges. We keep pouring money in, and it's going nowhere. And they really wanted some sort of agreement that would allow creditors to be repaid. And so this just basically bubbled on for many, many months. And as a result, they had this situation where by the time they went into these last-minute negotiations, everybody was fighting, and nobody was able to come to any sort of agreement.

So the particular things that were very ominous this weekend is that there was a threat of expulsion for Greece from the euro, basically taking of assets to pay creditors. And Tsipras, the prime minister of Greece, held out. He wanted to make sure there were some - some measure of Greece sort of hanging onto it, if you will, and not just having it all be about what the creditors wanted.

MONTAGNE: And just briefly, banks in Greece have been closed, and they cannot wait for negotiations on details of this bailout. So what's going to happen? Is there going to be interim money coming in?

NELSON: There hopefully will be. That's the plan, anyway. Today the European Central Bank and the finance ministers in separate meetings will be talking about the so-called bridge financing because it's going to take weeks to negotiate an actual bailout program for Greece, which will also exceed the $60 billion that Greece had asked for.

MONTAGNE: Soraya, thanks very much.

NELSON: You're welcome, Renee. Transcript provided by NPR, Copyright NPR.