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Roundup: Lithuanian gov't gives green light to third Greek bailout talks

Xinhua, July 17, 2015 Adjust font size:

The Lithuanian government on Thursday approved the European Commission's decision to start negotiations, together with the European Central Bank and International Monetary Fund (IMF), with Greece on a third bailout.

"I want to stress that financial support to Greece from the European Stability Mechanism (ESM) will be provided at no cost to Lithuania. Therefore, I call upon the politicians not to speculate on this subject and not to mislead the society," Lithianian Finance Minister Rimantas Sadzius said in the statement.

"I have no doubts the negotiations will be complicated, while the results will have to be approved again by all the member states of the euro zone, including Lithuania," Sadzius told journalists after the government's meeting, local website vz.lt reported.

Much will depend on whether Greece will implement the reforms which would allow the country's economy to get back on track, he added.

The ESM operates as the euro area's permanent firewall fund. The ESM issues debt instruments in order to finance loans and other forms of financial assistance to the financially-troubled euro area member states.

Lithuania, as the newest euro zone member, is contributing to the ESM for the first time this year. Lithuania's payment of paid-in capital to the ESM will be made in five annual installments of more than 60 million euros (65.2 million U.S. dollars) each.

However, the paid-in ESM capital is not used for loans, instead it serves as collateral for ESM bonds, the Lithuanian Ministry of Finance said in a statement.

The Greek bailout deal involves three-year financial support of as much as 86 billion euros under ESM assistance, including financing from the IMF and privatizing Greece's state assets. (1 euro = 1.09 U.S. dollars) Endit