Cabinet to approve PSI and discuss implementation

Greece is expected to launch on Friday a public offer for a bond swap designed to knock 107 billion euros off its debt held by banks and other private investors.

The formal announcement is expected after a Cabinet meeting. Greece hopes to complete the debt restructuring process, known as PSI, by March 12.

The cabinet is also expected to discuss implementation of the country’s new austerity program.

On Thursday, Parliament approved the details of the bond swap, which will call on bondholders to accept a 53.5-percent haircut on the face value of their holdings.

Finance Minister Evangelos Venizelos said the approval of the debt swap deal -- known as PSI (for private sector involvement) -- “will allow us to start emerging from the maelstrom.” “But to succeed, we need to be united, serious, trustworthy, persistent and to work, work, work,” he said.

Government spokesman Pantelis Kapsis insisted that authorities are “determined to take all the measures necessary for the agreement to proceed as planned.”

In comments to state television channel NET, he added that additional measures for 2013 and 2014 would be discussed in June, when a new government is expected to be in place following elections set for April.

Also on Thursday, Parliament’s social affairs committee approved a second bill which details the implementation of austerity measures and reforms that already have been approved and imposes another 3.2 billion euros in extra measures including cuts to pensions.

That bill is to be voted on next Wednesday.

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