In other words, bailouts encourage risk-taking.
Merkel, who like Greece?s hard-left Prime Minister Alexis Tsipras, faced rebels in her own party ranks, argued passionately that it was the last chance to prevent “chaos” in the crisis-hit country.
Stubb, who has been one of Greece’s most outspoken critics, says there are up to six ways to get Athens this so-called bridge financing. Greece also has to adopt a second set of measures on July 22.
The European Central Bank increased emergency funding to keep the country’s banks from collapse on Thursday.
Merkel has been harshly criticised for forcing more austerity on Greece, using the threat of a five-year euro “time-out” that had been floated by Finance Minister Wolfgang Schaeuble. The bill passed 229-64 in the 300-member Greek Parliament, thanks to votes in favour by three pro-European opposition parties.
European Union President Donald Donald Tusk told the daily Frankfurter Allgemeine Zeitung that the idea gave Merkel an ideal threat scenario, but insisted the deal in the end aimed ‘solely at helping Greece.’.
The Dutch parliament does not have to vote to approve the deal.
Merkel also won support from the Social Democrats, the junior coalition partner.
“A country can not, through a new election, change European contracts”.
Athens made a major concession by getting no up-front guarantees on debt in its agreement (among the dozens of concessions it made). The Chancellor and her finance minister could try to lead the country in a different direction, but they’d likely have an extremely difficult time doing so.
British Treasury chief George Osborne came to a European Union meeting of finance minister with a clear message – don’t expect Britain, which is not part of the euro, to pay for any of Greece’s rescue money. The Greek leader surrendered Monday to fresh demands for austerity and privatisation, opening the door to talks on a new bailout.
“We must find a way that works, that functions, and that is very complicated”, he said. Greek lawmakers backed the package by 229 votes to 64.
The EU’s planned €85 billion ($93 billion) bailout for Greece has drawn harsh criticism from Germany’s liberals and the populist and eurosceptic Alternative for Germany, AfD.
“The Eurogroup welcomes the adoption by the Greek Parliament of all the commitments specified in the Euro Summit statement” reached in marathon talks last weekend, the eurozone’s finance ministers said.
Finland has taken a hard line over Greece in recent weeks.
The bailout package and its austere measures are being debated in Greece’s parliament. We are certain to encounter problems in the years to come.
Draghi, after months of roller-coaster negotiations, also conceded that doubts remain about the “willingness and capacity” of the Greek government to push through the economic reforms it has agreed to. Greece’s stock market has been closed since late June, when banks were shut.
As a result, expectations have risen that Greece will secure a three-year financial bailout which will allow it to get back towards some sort of economic normality following weeks of crisis which have seen banks shuttered and withdrawals at ATMs limited to 60 euros (£41) a day.
Domvrovskis adds that the Commission is looking for guarantees to protect non-euro nations on such a loan.
Schaeuble has taken a hardline approach. On Thursday, he said that “it would perhaps be a better way for Greece, and many say that – increasingly in Greece too”.