European debt crisis

Finance Minister Yanis Varoufakis admitted on Wednesday that Greece may face difficulties in finding the money to pay its obligations to the International Monetary Fund and the European Central Bank over the next few months.

By Lefteris Papadimas & Stephen Brown

Greece admitted on Wednesday it will struggle to make debt repayments to the IMF and the European Central Bank this year as Germany?s finance minister voiced open doubts about Athens?s trustworthiness.

German Chancellor Angela Merkel on Wednesday welcomed as a "starting point" reform pledges made by Greece in return for a four-month extension to its bailout program.

"This is good news considering what was being said only weeks ago," Merkel said, adding however that "much work lies ahead" in talks between Athens and its international creditors.

Irish Finance Minister Michael Noonan said Greece should seek to reduce interest rates on its debts and push for later repayment dates rather than the ?nuclear? options of leaving the euro area and writing off loans.

Greece will be able to borrow from the financial markets once it achieves a debt restructuring, investment and sustained primary budget surpluses, Finance Minister Yanis Varoufakis said on Wednesday.

"For one to be able to return to the markets for borrowing you need to meet three criteria: primary surpluses, restructuring of debt and investments," he told Real FM radio.

German Chancellor Angela Merkel has asked her conservative Christian Democratic Union to support the proposed extension of Greece's bailout programme in a parliament vote this week, AFP reported on Tuesday.

The eurozone finance ministers earlier in the day approved a four-month extension of the financial rescue programme for Greece after Athens issued a list of reform proposals.

The new Greek government is serious about its reform commitments but it will take time to agree on the details of its reform plans, Eurogroup head Jeroen Dijsselbloem said on Tuesday.

BERLIN - Germany has received Greece's plans for economic reforms but will not comment on them, a government official said on Tuesday, adding that eurozone finance ministers would discuss the proposals later on Tuesday.

"The list was received yesterday at 23:32. This list is being looked at by the three institutions," the official said.

Greece's eurozone future was on the line on Feb. 24 as international creditors scrutinised a list of reforms to see if Athens has done enough to deserve an extension to its bailout programme.
      

Deutsche Bank has circulated a chart describing the five necessary steps in order for Greece to avoid an exit from the Eurozone, the financial markets' "bogeyman" known as "Grexit".

-The first step is a short-term bailout extension, or "loan agreement" extension, as Athens prefers to call it.