February 21, 2012
Europeanleaders called the massive new bailout for Greece announced Tuesday “unprecedented,” but anxiety lingered over whether the rescue plan would work.
Officials were mindful of a recent report by the International Monetary Fund, the European Commission and the European Central Bank that gave a gloomy assessment of the rescue plan and predicted a strong likelihood that Greece would not be able to avoid future bankruptcy, even with the second bailout. On Tuesday, they announced that they were taking strict measures to try to ensure that Greece lives up to the deal.
To protect the $172 billion that international lenders will be channeling to Greece, European leaders said they would help the country only if it puts language in its constitution that requires it to make paying its debts a “priority.” The package directs the bailout money to be rolled into a special account and then passed out to Greece’s creditors, the cash shielded from the Greek government’s other financial needs. European officials also said they would station a permanent team of inspectors in Athens to make sure Greece was implementing far-reaching austerity measures.
“We have seen Greece has been derailing several times in the past years now. Without these special measures, we could not be sure whether or not Greece would implement” the rules, Dutch Finance Minister Jan Kees de Jager told reporters in Brussels on Tuesday. “Implementation risks are high in the case of Greece, higher than anywhere else.”
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