Key dates in Greece's debt crisis - KMOV.com

Key dates in Greece's debt crisis

ATHENS, Greece (AP) -- A look at key dates in Greece's financial crisis.

Oct. 18, 2009 -- George Papandreou's new Socialist government reveals that the budget deficit is set to rise to at least 12 percent of the country's gross domestic product, double the previous government's estimate. The shortfall eventually reached 15.6 percent of GDP.

Dec. 8, 2009 -- Fitch Ratings downgrades Greece's credit rating from A- to BBB+. Bond grades from the three major agencies eventually reached junk status.

March 3, 2010 -- Greece announces a major austerity plan -- with many more to follow -- increasing the VAT and tax on cigarettes and alcohol, and freezing pensions and curbing civil servants' pay.

April 23, 2010 -- After an initial round of austerity, the prime minister calls for a eurozone-IMF rescue package as Greece is unable to cope with rising borrowing costs.

May 2, 2010 -- Eurozone finance ministers agree to rescue Greece with (euro) 110 billion in loans over three years.

May 18, 2010 -- Greece receives (euro) 14.5 billion in bailout loans, just in time to meet a crucial debt refinancing deadline.

April 23, 2011 -- European Commission data shows the Greek budget deficit jumped to 13.6 per cent of gross domestic product in 2009. This is almost a full percentage point higher than the Greek government's projection of 12.7 per cent.

June 29, 2011 -- Parliament passes the (euro) 28 billion austerity bill in the face of two days of violent protests during which some 300 protesters and police are injured. The package contains severe spending cuts and tax increases. The European Union had set passage of the bill as a precondition for further aid.

July 3, 2011 -- European finance ministers agree to release a vital (euro) 8.7 billion installment of aid money for Greece but postpone a decision on a second bailout. Without the money, plus (euro) 3.3 billion which the IMF board authorized a few days later, Greece would have defaulted on its massive debts within days, becoming the first developed country in 60 years to do so.

Oct. 2, 2011 -- The finance ministry announces Greece will not meet the 2011 and 2012 deficit targets agreed to with the international lenders. It estimates the 2011 deficit at 8.5 percent of GDP instead of the targeted 7.8 percent and the 2012 deficit at 6.8 percent instead of 6.5 percent. It blames the deviation to a deeper recession than forecast. Later, it will revise the 2011 deficit to 9.5 percent.

Oct. 27, 2011 -- European leaders reach a deal with Greek debt-holders that would see private investors take a 50 per cent cut in the face value of their bonds, a deep haircut that officials believe will reduce Greek debt levels to 120 per cent of gross domestic product by the end of the decade. The agreement, struck after nearly 11 hours of talks at a summit of eurozone leaders, includes a new (euro) 130 billion bailout of Greece by the European Union and the International Monetary Fund.

Nov. 4, 2011 -- Papandreou survives a crucial vote of confidence in parliament, but a group of senior Socialists call for a government of national unity to be formed quickly under a new leader.

Nov. 5, 2011 -- The leaders of Greece's two largest political parties decide to form a government of national unity to start implementing a (euro) 130 billion bailout plan, then take the country to elections.

Nov. 11, 2011 -- Lucas Papademos, a former central banker, is sworn in as Prime Minister of a government supported by the Socialists and two conservative parties.

Nov. 16, 2011 -- Papademos wins confidence vote in parliament. First meeting with International Institute of Finance Managing Director (IIF) Charles Dallara, who represents Greece's private creditors.

Jan. 28, 2012 -- Greece and investors who own its bonds reach a tentative deal to significantly reduce the country's debt and pave the way for it to receive the much-needed (euro) 130 billion bailout.

Feb. 21, 2012 -- After more than 12 hours of talks, the countries that use the euro reach an agreement to hand Greece (euro) 130 billion ($170 billion) in additional bailout loans to save it from a potentially disastrous default next month. The deal is expected to bring Greece's debt down to 120.5 percent of gross domestic product by 2020 -- around the maximum that the International Monetary Fund and the eurozone consider sustainable.

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