Eurozone approves Greek bailout accord worth up to 86 bn euros

According to a statement released by the European Commission (EC) immediately after the meeting, the new billion-dollar loans will be made available over the next three years to Greece by the ESM.

Lagarde said that Athens needs “well beyond what has been considered so far” and that the country “cannot restore debt sustainability exclusively through actions on its own.

Unable to borrow on the worldwide markets, another bailout is all that stands between Greece and a disorderly default on its debts that could see it forced out of Europe’s joint currency“.

Greece faces an urgent deadline on 20 August, when it must repay about €3.2bn to the European Central Bank (ECB).

“The message of today’s Eurogroup is loud and clear: on this basis, Greece is and will irreversibly remain a member of the Euro area,” Jean-Claude Juncker, European Commission president, said in a statement.

The new bailout deal was passed on Friday.

Among other aspects of the deal, Eurogroup President Jeroen Dijsselbloem announced protection to Greek small and medium-size enterprises saying the “bail-in of depositors will be explicitly excluded”.

But when Germany’s finance minister threatened to bounce the nation out of the eurozone, the government folded.

Even so, Prime Minister Alexis Tsipras, whose leftist Syriza party was deeply split in the vote, fell short of the 120 votes he would need to survive a censure motion, “leading to speculation he would call a confidence vote next week and snap elections as early as next month”, the Guardian reports.

The fund, worth up to 50 billion euros, is supported to be established in Greece under the supervision of the relevant European institutions by the end of this year.

Dijsselbloem said it was still unclear that Greece could not afford to service its debts but he was optimistic differences with the International Monetary Fund could be overcome.

Greek Finance Minister Euclid Tsakalotos, who flew to Brussels after the night long parliamentary debate, said that “any deal is only as good as what you make of it”.

While the broad outlines of the bailout agreement were set at a marathon, all-night summit a month ago and further filled in by negotiators who concluded a draft on Tuesday, euro zone ministers devoted some of their six-hour meeting to detailing a plan to recapitalise Greek banks.

“I don’t regret that I fought like no one before me in order to defend the rights of the Greek people, nor that I chose compromise over the heroic Dance of Zalongo”, he said, referring to a the mass suicide of women during a rebellion against the Ottomans in 1803.

“We took a painful decision of responsibility, and took a step back”, Tsipras said in his defense of the bailout.