Code: 268920 A

ILNA: Euro zone finance ministers agreed in principle on Friday to extend Greece’s financial rescue by four months, averting a potential cash crunch in March that could have forced the country out of the currency area.

The deal, to be ratified once Greece’s creditors are satisfied with a list of reforms it will submit next week, ends weeks of uncertainty since the election of a leftist - led government in Athens which pledged to reverse austerity.

" Tonight was a first step in this process of rebuilding trust, " Jeroen Dijsselbloem, chairman of the ۱۹ - nation Eurogroup, told a news conference. " We have established common ground again to reach agreement on this statement. "

The agreement, clinched after the third ministerial meeting in two weeks of acrimonious public exchanges, offers a breathing space for the new Greek government to try to negotiate longer - term debt relief with its official creditors.

But it also forced radical young Prime Minister Alexis Tsipras into a major climbdown since he had vowed to scrap the bailout, end cooperation with the " troika " of international lenders and roll back austerity.

European Union paymaster Germany, Greece’s biggest creditor, had demanded " significant improvements " in reform commitments by Athens before it would accept an extension of euro zone funding.

The two main combatants around the table put a radically different gloss on the result.

" Being in government is a date with reality, and reality is often not as nice as a dream, " German Finance Minister Wolfgang Schaeuble told reporters, stressing Athens would get no aid payments until its bailout program was properly completed.

" The Greeks certainly will have a difficult time to explain the deal to their voters, " the conservative veteran said.

Greek Finance Minister Yanis Varoufakis said the talks had shown elections could bring change to Europe. He insisted he had averted " recessionary measures " and said the government still hoped to raise the minimum wage and rehire some public sector workers.

" Nobody is going to ask us to impose upon our economy and society measures that we don’t agree with, " Varoufakis said.

The euro rebounded against the dollar and global equity markets surged to record closing highs while Greek government bond yields fell on optimism for a debt deal.


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