The European Stabilization Mechanism (ESM) on Monday announced the successful completion of the third macro-financial assistance program for Greece and the country’s exit from the external management of foreign creditors.
“This marked the end of the largest package of sovereign aid in history, including three different programs. Thanks to unprecedented financial support provided on very favorable terms, Greece was able to modernize its economy and restore investor confidence,” the press release says.
Over the past three years, the country has received € 61.9 bn for macroeconomic assistance and recapitalization of its banks. Under this program, Greece was available for another € 24.1 bn, but, as noted in the fund, they are not useful to Athens. The last tranche of € 15 bn was approved at the end of June. € 5.5 bn of them went to service the national debt of the country, and the remaining € 9.5 bn – to form a “cash pillow.”
In addition to this money, Greece received in the period from 2012 to 2015 € 141.8 bn in loans from the European Financial Stability Facility (EFSF). The amount provided by the two funds amounted to € 203.77 bn. Athens will have to repay this loan for more than 30 subsequent years. The first package of financial assistance from the Eurogroup – € 52.9 bn – came in the form of bilateral loans from 2010 to 2012.
“Today we can safely conclude the ESM programme with no more follow-up rescue programmes, as for the first time since early 2010 Greece can stand on its own feet. This was possible thanks to the extraordinary effort of the Greek people, the good cooperation with the current Greek government and the support of European partners through loans and debt relief,” said Mario Centeno, the Chairperson of the ESM Board of Governors.
ESM managing director Klaus Reing stressed that Greece became the fifth country for the fund – after Ireland, Spain, Portugal and Cyprus – which was provided with macro-financial assistance.
Greece received money on the terms of austerity and a series of reforms. These included changes in labor legislation, economic reform, reduction of pensions and tax increases. Also, the country received significant assistance from the International Monetary Fund.