European Union (EU) finance ministers agreed on Friday to help heavily indebted Greece out of its financial straits by extending its bailout by four months.
The Greek government’s total debt amounts to $367 billion, or 170% of its gross domestic product (GDP). The country’s debt to the troika of creditors comprising of the European Union (EU), the European Central Bank (ECB), and the International Monetary Fund (IMF) is now estimated at $270 billion.
Greece’s current bailout program, which is valued at $240 billion, was approaching a deadline that was set to expire on February 28.
Germany, Greece’s largest creditor, had urged for “significant improvements” in financial reforms by the Greek government before it would extend Eurozone funding.
The agreement that was reached on Friday stipulates that Greece must submit a letter by Monday listing all of the policy measures that it plans to undertake during the bailout period to ensure that the Greek government abides by the conditions.
Greece had previously hoped to extend its bailout for six months to add time to find additional financing.
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