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Greece’s creditors close to writing off some of its debt

Christine Lagarde
Christine Lagarde: ‘The assurances from Greece’s European partners that they will consider further measures and assistance … are welcome.’ Photograph: Etienne Laurent/Xinhua Press/Corbis

Greece’s international creditors are edging closer to accepting that they will have to lighten the country’s monumental debt burden if its shattered economy is ever to be fully rehabilitated.

In an implicit recognition that the eurozone’s weakest member state will never recover unless some of its debt is forgiven, the International Monetary Fund’s managing director, Christine Lagarde, said that Athens’ debt pile, projected to reach a staggering 185% of GDP this year, would remain high “well into the next decade”.

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Eurozone unemployment hits new high with quarter of under-25s jobless

Blockupy Protests In Frankfurt
Blockupy demonstrators wield giant puppets outside the headquarters of Deutsche Bank in protest against ECB debt policy as unemployment figures, especially for under-25s, hit a new high. Photograph: Sean Gallup/Getty Images

Protesters who picketed the European Central Bank on Friday are planning a second day of action across European cities as anger grows over austerity measures that many blame for taking eurozone unemployment to an all-time high.

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Barroso: crisis ‘unique opportunity’ for reform

EUROPEAN COMMISSION PRESIDENT, JOSE MANUEL BARROSO, ADDRESSES THE STATE OF THE UNION CONFERENCE, FLORENCE, 9 MAY. “THE CRISIS HAS AMPLIFIED THE URGENT NEED FOR A STRONGER COOPERATION AND GOVERNANCE AT EUROPEAN LEVEL AND BOLD REFORMS AT NATIONAL LEVEL”. |EUROPEAN UNION 2013
 
 The current economic crisis illustrates the need for “a long overdue reform agenda” according to the European Commission president.

Addressing the state of the union conference in Florence on 9 May, Jose Manuel Barroso said that the crisis “has amplified the urgent need for a stronger co-operation and governance at European level and bold reforms at national level.” 

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Germany sees surge in immigration from crisis-hit Europe

An influx of people from crisis-hit southern European countries like Spain, Italy and Greece has led to the biggest surge in German immigration in nearly 20 years.

The Federal Statistics Office said 1.081 million immigrants flocked to Germany last year, up 13 percent from 2011 and the highest number since 1995.

Leading the way were arrivals from countries in eastern Europe and from southern euro zone countries struggling with recession and high unemployment as a result of the currency bloc’s three-year old debt crisis.

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Slovenia sell-off planned in attempt to avoid bailout

Slovenia's parliamentary party leaders
Slovenia’s parliamentary party leaders at a meeting in Ljubljana. Slovenian banks are nursing €7bn (£5.8bn) of bad loans. Photograph: Jure Makovec/AFP/Getty Images

Slovenia is looking to sell its largest telecommunications operator and second largest bank, sources said, as it steps up efforts to shore up its finances and avoid an international bailout.

The country is racing to convince investors it has a credible strategy for raising the funds it needs to stay solvent, and is due to adopt an economic reform programme on Thursday before presenting it to the European Commission.

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Russia adds to Cyprus’s financial relief with loan extension and rate cut

Demonstrators in Cyprus
Demonstrators in Nicosia burn an EU flag after the Cypriot government approved the bailout last week. Photograph: Andreas Manolis/Reuters

Russia is extending the maturity and reducing the interest on its loan to Cyprus, a document prepared by international lenders has shown.

Russia’s agreement provides additional, though expected, financial relief to the island on top of a bailout by the EU and the International Monetary Fund.

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'Worst is over' claims Greece ahead of IMF health check

Greece's crisis-hit economy is finally beginning to heal, according to the country's finance minister ahead of a crucial report by the International Monetary Fund which is likely to be more positive than in the past.

Mr Stournaras’s upbeat tone comes ahead of the IMF’s health check on the Greek economy, which is expected to indicate that the country is turning the corner.
 

Yannis Stournaras said “the worst is over” and the country had “reached the [bottom of the] trough”.

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