Greece Says It Will Get New Bailout Money, Avoid Default

Posted September 27th, 2011 at 9:26 am (UTC-5)
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Greece is voicing new confidence that it will be able to carry out its austerity plan in order to receive more international financial assistance in time to avoid a default next month.

Greek Prime Minister George Papandreou told German business leaders Tuesday that his government is making a “superhuman effort” to cut its debt. He lashed out at critics of his country, saying that if they only heaped “punishment and scorn” on Greece, the nation’s financial crisis would not be resolved.

Mr. Papandreou said he “can guarantee” that Greece will live up to all its commitments made to international creditors. He said the country, now engulfed in a deep recession, would eventually emerge with “growth and prosperity after this period of pain.”

He spoke ahead of a night-time meeting with German Chancellor Angela Merkel on the debt crisis. Speaking at the same business forum as the Greek leader, Mrs. Merkel said she has “absolute respect” for the spending reforms that the Papandreou government has adopted.

But she offered no new German financial assistance for beleaguered Greece, saying that Berlin is “not available” for more more stimulus programs. The German government said the European bailout fund does not need to be increased beyond its current $594 billion figure.

Some financial analysts say the fund needs to be increased by several trillion dollars, in case other European countries besides Greece eventually need large-scale financial assistance.

Greece is looking to secure a new $11 billion portion of its bailout from last year in order to keep its government operating and avoid a default on its financial obligations — in effect, borrowing more to repay loans. International creditors are expected to return to Athens soon to continue its examaination of the government’s financial records, to determine whether Athens is adhering to its commitments before deciding whether to release the money.