"We believe that we are on a very steady course, although a difficult one, with many sacrifices, that will lead us to a strong and viable economy. We received the support of our (EU) partners, and this is a positive development for Greece's future, and not simply a 'green light'," he added.

   The EU heads of state and government on Thursday agreed the basic guidelines for new financial assistance to Greece that will meet the country's borrowing needs up to end-2014, and reiterated its preparedness to disburse the 12 billion euros 5th tranche of the 110 billion euro EU-IMF bailout loan in early July, on condition that the Greek government's Medium-Term fiscal programme and its Implementation Law are passed by parliament by June 30.


The Medium-Term Fiscal Strategy Program is slated for vote in the 300-seat unicameral parliament on Tuesday, June 28, after a two-day debate, followed immediately by the Implementation Law.

The EU leaders also agreed a draft statement of Conclusions, to be finalised on Friday, which contains lengthy reference to Greece, which acknowledges the "considerable progress" achieved in the last year and gave the go-ahead for a second assistance program covering up to the end of 2014.

According to government sources, the Greek prime minister, after intense negotiations, asked for new financing for Greece for the next three years, which was accepted by the EU partners following Papandreou's assurances that the Medium-Term fiscal programme its Implementation Law will be passed by parliament.


"This shields the country," the sources said.


The European Council also made reference to voluntary participation of the private sector in the second assistance program for the Greek economy, as per the decisions of the recent Eurogroup meeting, which would lighten the burden of the country's borrowing needs.

A third important aspect pertaining to Greece contained in the draft Conclusions is endorsement of the European Commission's intention to "enhance synergies" to increase Greece's absorption of EU funds under the National Strategic Reference Framework (NSRF, or ESPA) through refocusing the funds in the direction of stimulating growth and employment and the creation of a comprehensive programme of technical assistance to the country.

Below is the extensive reference on Greece contained in the draft statement of conclusions:


"As regards Greece, the European Council recognises the considerable progress achieved over the last year, particularly in the area of fiscal consolidation. It welcomes the Greek government's continued strong commitment to implement the adjustment programme.

The European Council calls on the national authorities to continue implementing with resolve the necessary adjustment efforts to put the country on a sustainable path. A comprehensive reform package agreed upon with the Commission, in liaison with the ECB (European Central Bank), and the IMF (International Monetary Fund), and adoption by the Greek Parliament of the key laws on the fiscal strategy and privatization must be finalized as a matter of urgency in the coming days. Following the request by the Greek government announced by the Greek Prime Minister, this will provide the basis for setting up the main parameters of a new programme jointly supported by its euro area partners and the IMF, in line with current practices, and at the same time for allowing disbursement in time to meet Greece's financing needs in July.

The euro area Heads of State or Government agree that required additional funding will be financed through both official and private sources. They endorse the approach decided by the Eurogroup on 20 June as regards the pursuit of voluntary private sector involvement in the form of informal and voluntary roll-overs of existing Greek debt at maturity for a substantial reduction of the required year-by-year funding within the programme while avoiding a selective default.

The euro area Heads of State or Government call on Finance Ministers to complete work on outstanding elements to allow the necessary decisions to be taken by early July.

The European Council calls on all political parties in Greece to support the programme's main objectives and key policy measures to ensure a rigorous and expeditious implementation. Given the length, magnitude and nature of required reforms in Greece, national unity is a prerequisite for success.

The European Council welcomes the Commission's intention to enhance the synergies between the loan programme and the EU funds. The European Council supports all efforts to increase Greece's capacity to absorb EU funds in order to stimulate growth and employment. This can be done by refocusing them on improving competitiveness and employment creation. Moreover, the European Council welcomes and supports the preparation by the Commission, together with the Member States, of a comprehensive programme of technical assistance to Greece.

Heads of State or Government are conscious of the efforts that the adjustment measures entail for the Greek citizens, and are convinced that these sacrifices are indispensable for the economic recovery and will contribute to the future stability and welfare of the country."