Greece “Close” to Debt Swap Deal

Posted January 28th, 2012 at 5:00 pm (UTC-5)
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Greece and its private investors say they are close to a deal that would significantly reduce the country's debt and save it from bankruptcy.

Negotiators for the Institute of International Finance, Charles Dallara and Jean Lemierre, met with Greek Prime Minister Lucas Papademos and Finance Minister Evangelos Venizelos for three consecutive days in Athens.

Venizelos told reporters Saturday that the deal, which qualifies Greece for a new bailout, will be finalized next week.

“Next week we will be in a position to complete this process (the debt swap deal) in parallel, of course, with the discussions and negotiations for the new bailout program.”

Greece must secure a new $169 billion loan package within the next few weeks to avoid defaulting on its financial obligations due in March.

The country's prospective pact with 32 large financial institutions would cut in half the amount Greece owes them. This week's negotiations focused on the interest rate Greece must pay on the new bonds.

The European Union and international lenders also have been pressing Greece to step up economic reforms as one of the conditions for a new loan.