Euro zone finance ministers agreed at an informal Cyprus meeting on Friday to give indebted Greece a bigger window to implement spending cuts, as the country struggles to qualify for the next 33.5 billion-euro tranche of its second 130 billion-euro bailout.
Eurogroup, pending a final decision in October, signaled Athens is not likely to receive more money, but probably get a two-year extension to implement economic and structural overhaul, as economic recession cripples Spain`s ability to deliver.
Two days after Germany`s Federal Constitutional Court gave the green light for the bloc`s permanent rescue fund, Eurogroup Chairman Jean-Claude Juncker said the EU and IMF must take a decision by October-end to review the Greek debt-cutting plan.
Juncker added that there was no question of Greece exiting the euro zone. He called on Greek government and international lenders to devise "game changers" and agree on a "set of credible measures to close the fiscal gap between 2013 and 2014".
Troika of European Commission, the International Monetary Fund and the European Central Bank, are expected to furnish a report on the state of Greece`s economy, and based of that report, the Eurogroup will discuss Greece`s finances in Luxemburg on October 8.
Spain topped the agenda in the Cypriot capital, where EU finance ministers and officials had discussed Spain`s public finances. Juncker said Spain is sticking to reforms and the ministers were positive that the fiscal target for this year "remains within reach".
Spain will "draw up a National Reform Program by the end of September based on recommendation of the EU with the regular commitments and precise timetables." European Economic and Monetary Affairs Commissioner Olli Rehn reportedly said on Friday.
Its remains unclear whether Madrid would tap a full-blown bailout beyond the 100 billion euro it has already requested for its ailing banks. None of the officials made any reference about the matter, and Spain itself has still taken no decision to seek further aid.
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