Greece needs more aid by September

City A.M. Reporter
Greece needs a fresh tranche of international aid by September 15 and is prepared to push new austerity measures and privatisations through to secure it, its finance minister has said.

Evangelos Venizelos said world financial markets were using Greece as an excuse for an attack on the euro and markets would not be satisfied whatever Athens did.

He promised that Greece would stick rigorously to its reform and revenue targets to secure continued EU/IMF funding.

"Everybody knows that Greece is not the problem. Greece is the excuse for an attack on the euro," Venizelos told a news conference on his return from a Eurogroup finance ministers' meeting in Brussels.

Greece's hopes for more funding were kept alive after the socialist government passed a package of budget cuts, tax rises and privatisations to make the €230bn (£203bn) economy more competitive, despite political opposition and street violence.

Athens needs a second bailout package to take it through to mid-2014 as it faces a funding gap next year under its current EU/IMF rescue deal and cannot return to bond markets in 2012.

Eurozone finance ministers took no immediate action but promised cheaper loans, longer maturities and a more flexible rescue fund "shortly" to help Greece and other EU debtors and halt financial contagion.

They also acknowledged for the first time that some form of default may be needed to cut Greece's huge debt burden and secure economic recovery.

Venizelos said Greeks should unite behind the austerity plan to secure a stronger bargaining position with creditors.

"The invitation to the political opposition to negotiate together the new programme and its details is still valid. Any consensus in Greece, even the smallest, strengthens our position abroad," he said.