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Tuesday, October 11, 2011

Europe: EC, IMF, ECB says aid likely for Greece, Slovakia votes on EFSF

by Calculated Risk on 10/11/2011 10:10:00 AM

Statement by the European Commission, the ECB and IMF on the Fifth Review Mission to Greece

Staff teams from the European Commission (EC), European Central Bank (ECB), and International Monetary Fund (IMF) have concluded their fifth review mission to Greece to discuss recent economic developments. The mission has reached staff-level agreement with the authorities on the economic and financial policies needed to bring the government’s economic program back on track.
Once the Eurogroup and the IMF’s Executive Board have approved the conclusions of the fifth review, the next tranche of EUR 8 billion (EUR 5.8 billion by the euro area Member States, and EUR 2.2 billion by the IMF) will become available, most likely, in early November.
From the NY Times: Slovak Leader Vows to Resign If Bailout Vote Fails
Lawmakers in Slovakia were scrambling on Tuesday to avert political and financial disaster over the vote on the expansion of the euro rescue fund, after the prime minister tied the fate of her government to the legislation through a confidence vote.
The opposition Smer-Social Democracy party could bridge the gap, but its leader, the former prime minister Robert Fico, said he would support the proposal only in exchange for new elections, which could return him to power. He told reporters in Bratislava that his party would abstain from the vote but could support the measure at a later session if it failed.
It sounds like the EFSF vote might fail in Slovakia before passing later this week. Slovakia is the last country to vote on the enhanced EFSF.

The next step for Greece is the size of the haircuts, and various reports suggest the haircuts will be close to 50%.