Europe Moves to Restore Greece Funding

Europe moved to re-open funding to Greece’s stricken economy on Thursday after the parliament in Athens approved a new bailout program in a fractious vote that left the government without a majority.  The European Central Bank increased emergency funding for Greek lenders, although capital controls will have to remain in place to avoid a run on the banks when they reopen on Monday.

European Union finance ministers also approved 7 billion euros ($7.6 billion) in bridge loans to keep Greece afloat, allowing it to make a bond payment to the ECB next Monday and clear its arrears with the International Monetary Fund.  The loans will be finalised on Friday provided Germany’s parliament approves a Berlin government request to open talks on a three-year bailout program – Greece’s third in the past five years – worth up to 86 billion euros.

A majority of Germany’s conservative lawmakers voted in favor of starting talks on a third Greek bailout in a test ballot on Thursday, the eve of a vote in the Bundestag lower house of parliament, sources in the conservative parliamentary faction said.  In the test ballot, 48 lawmakers in the conservative bloc opposed talks on further Greek aid while three abstained, the sources said.