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1st LD Writethru: Finance ministers meeting on Greece "won't be short": Eurogroup head

Xinhua, August 15, 2015 Adjust font size:

Eurogroup President Jeroen Dijsselbloem said on Friday that the upcoming finance ministers meeting "won't be short," as a fresh memorandum of understanding (MoU) on Greece's bailout package has prompted questions and criticism from member states.

"It won't be short... there will be questions, there will be criticism," Dijsselbloem told reporters minutes before meeting with his colleagues of the single currency bloc.

He said ministers may have to clarify or improve on issues related to the MoU, which agreed earlier this week in Athens between Greek authorities and its creditors on a 85-billion-euro bailout plan.

Germany was reported to have pointed fingers at the MoU, arguing that some terms deviated from the austerity content of a primary agreement clinched on July 13.

"I am sure there will be some critic remarks," Dijsselbloem said.

He also admitted that "debt stability is still the major point of concern, especially for the IMF (International Monetary Fund)."

The IMF has provided "technical assistance" to the weeks-long negotiations between Brussels and Athens but was reported to have refused to participate in Greek third bailout unless the country's debt is restructured.

"We will look at that closely in October... and give further guarantees if necessary so that the IMF can come on board in October, because it is very important for all of us," he added.

Earlier the day, Jean-Claude Juncker, president of the European Commission (EC), or the European Union (EU) executive body, tweeted a statement, released by the Commission together with the European Central Bank (ECB), which briefs on outcome of Athens negotiations and main points of the MoU.

According to the statement, the MoU has been agreed "at staff level" between Greek government and EU partners, referring to EC, ECB and the European Stability Mechanism (ESM), "with the input from the IMF."

The MoU demands further Greek reforms needed for the country's third bailout program in four main areas including achieving new fiscal targets, safeguarding financial stability, implementing labor and product reforms as well as modernizing state and public administration.

The fiscal target set for Greece in 2015 is a 0.25-percent-of-GDP (gross domestic product) primary deficit. For 2016 the goal is a primary surplus of 0.5 percent, for 2017 of 1.75 percent and for 2018 of 3.5 percent.

The German side was cited to complain that the MoU weakens the language of Euro Summit statement on issues like fiscal targets, the privatization and debt sustainability.

The MoU will make up part of the loan agreement, however it still needs to be approved at political level, ratified by member states and endorsed by the ESM's board of governors and board of directors.

Earlier in the morning, the Greek parliament overwhelmingly voted in favor of adopting series of new austerity measures to secure the long-awaited bailout package.

Debt-torn Greece is facing another urgent repayment of a 3.2-billion-euro loan to ECB due on Aug. 20 and is seeking to receive initial money from the bailout plan under the ESM. Endit