Greek MPs approve debt swap as part of bailout
THE GREEK parliament endorsed a debt swap with private bondholders yesterday that forms the core of its €130bn (£110.2bn) bailout, despite new protests against budget cuts demanded in return for the rescue deal.
The swap, in which private investors exchange their bonds for lower-value debt, will slice €100bn off Greece’s debt, a vital part of the EU and IMF plan aimed at cutting Greece’s liabilities from 160 per cent of gross domestic product to 120.5 per cent by 2020.
Eurozone finance ministers approved the bailout on Tuesday, averting the threat of a messy bankruptcy next month but doing little to allay doubts about the country’s long-term financial and social stability.
Doctors began a 24-hour strike yesterday over pay cuts – the latest of a torrent of protests against budget cuts.
However, the ruling alliance of Socialist PASOK and conservative New Democracy passed the law easily.
“By approving this law, parliament will allow us to start getting out of the vortex,” said finance minister Evangelos Venizelos.
The swap must be made by 12 March, before €14.5bn of debt repayments are due on 20 March.