BRUSSELS
European finance ministers have agreed to offer Greece a two-month extension of its bailout loan, the Council of the European Union announced Monday.
The extension of the bailout will permit the EU to provide the Greek government with the final €1.8 billion owed to the country with the loan.
The extension will permit a final review of the Greek government's efforts at fiscal reform by EU authorities, as well as by the International Monetary Fund and the European Central Bank, under the terms of the current European Financial Stability Facility program, the council said in a statement.
The facility is a temporary mechanism to provide funds in a crisis, created by the euro area Member States in June 2010. The facility provided financial assistance to Greece, Portugal and Ireland.
In 2010, Greece accepted a €110 billion euro bailout loan, the conditions for which imposed austerity measures, negotiated with the so-called "Troika," the European Central Bank, the European Commission and the International Monetary Fund. The deal was designed to prevent Greece from defaulting on its own debt.
On Sunday, the Greek parliament passed the 2015 budget, which the Greek government said addressed the reforms required under the conditions of the loan. But the Troika has expressed dissatisfaction with the budget, and demanded further austerity measures. The Troika is also pressing for structural reforms.
Athens has thus far rejected these demands. The fragile coalition that comprises the Greek government is not prepared to make further unpopular reforms.
Tense negotiations are expected to continue for some time.
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