Greece welcomes Eurogroup's "historic decision" on Greek debt

Eurozone countries agree on plan to help Greece end its bailout programme by August

People waving the Greek flag in Athens | AFP

Eurozone finance ministers early on Friday extended maturities and deferred interest of a major part of their loans to Greece along with a big cash injection to ensure Athens can stand on its own feet after it exits its bailout in August.

An additional 10-year grace period - where the loans' interest will not rise - will be granted as well. The yield on Greece's benchmark 10-year bond eased 0.2 percentage points to 4.1 per cent. "Now we should all, we and our partners, acknowledge that what was achieved was thanks to the sacrifices of Greek people", Pavlopoulos said on his part.

European Economic and Financial Affairs Commissioner Pierre Moscovici spoke of a "historical moment for Greece" and said a new chapter was beginning for the country.

Greece will maintain a primary surplus of 3.5 percent of its gross domestic product (GDP) until 2022 and, thereafter stick to EU budget rules, which would mean a primary surplus of 2.2 percent of GDP on average in the period from 2023 to 2060, according to European Commission estimates.

"We finally got to the end of this path which was so long and hard it is a historic moment", the former French finance minister said.

Athens has received €273.7 billion in assistance since 2010, enabling it to avoid punishing borrowing rates on debt markets.

"There is no doubt in our mind that Greece will be in a position to access financial markets", IMF Managing Director Christine Lagarde said, adding that for the medium term, the agreed measures would ensure Greek debt remained sustainable.

Under Friday's decision, Greece will receive a final 15 billion-euro ($17 billion) bailout loan installment, 9.5 billion of which will shore up an existing cash kitty to keep the country afloat post-bailout.

"I am happy", Greek Finance Minister Euclid Tsakalotos said after the talks.

Opposite the hardliners were France and the European Central Bank, which argued that reduced debt was crucial in order for Greece to gain the trust of the markets.

A report in the German daily, The Local, said that while conservative parties in Germany warned that supporting Greece would come at the cost of the German taxpayer, new figures show Germany has made money on the crisis.

Hoping to soothe concerns over Greece's debt sustainability, European creditors also pledged to provide further future debt relief tweaks "in the case of an unexpectedly more adverse scenario". "We think it's a tough requirement but you have to take the whole package as one".

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