May 19, 2010 / 10:16 AM / in 7 years

Timeline: Eurozone debt crisis

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(Reuters) - Here is a timeline of events in the Eurozone debt crisis since the new government came to power after elections in Greece last October:

May 19 - France says it is not considering a ban on naked short-selling on European debt and says it has not been consulted.

Short selling is a trade that bets a price will fall. Naked short selling is when a trader sells a financial instrument with out first borrowing the instrument or ensuring that it can be borrowed, as would be done in a conventional short sale.

-- Merkel urges the EU to speed up financial market supervision and introduce a new tax on them.

May 18 - Germany, in an attack on the financial speculation, which it blames for much of the euro zone's debt crisis, announces a ban on naked short selling of shares in the top 10 German financial institutions, euro government bonds and on related transactions in credit default swaps (CDS).

-- Euro zone finance ministers meet in Brussels to fine-tune their rescue plan, which comprises standby funds and loan guarantees that euro zone governments could tap.

May 17 - Germany says it is making plans to avert future crises.

May 13 - Prime Minister Jose Socrates and opposition leader Pedro Passos Coelho draw up steps to slash Portugal's deficit, including 5 percent pay cuts for senior public sector staff and politicians. The deficit, which stood at 9.4 percent in 2009, is to fall to 7.3 percent of GDP in 2010 and 4.6 percent in 2011.

May 12 - Spanish Prime Minister Jose Luis Rodriguez Zapatero sets fresh spending cuts of 15 billion euros in 2010 and 2011.

May 11 - Germany's cabinet approves the biggest national contribution -- 123 billion euros in loan guarantees -- to the euro zone's $1 trillion emergency package.

May 10 - Global policymakers install an emergency financial safety net worth about $1 trillion to bolster financial markets and prevent the Greek crisis destroying the euro.

-- The package consists of 440 billion euros in guarantees from euro zone states, plus 60 billion euros in a European debt instrument. The IMF will contribute 250 billion euros, taking the total to 750 billion euros, or around $1 trillion.

May 9 - The IMF unanimously approves its part of the rescue loans, and provides 5.5 billion euros immediately.

-- German Chancellor Angela Merkel's center right coalition loses state election in North-Rhine Westphalia, and its majority in the upper house, after agreeing to aid Greece.

May 6 - Greek parliament approves latest austerity bill.

May 4/5 - Public workers in Greece stage a 48-hour strike. Up to 50,000 protest in Athens. Three people are killed when a bank is set on fire.

May 2 - Papandreou says Greece has done deal with EU and IMF opening door to bailout in exchange for extra budget cuts of 30 billion euros over three years, on top of measures already set.

-- The package amounts to 110 billion euros over three years and is the first rescue of a member of the 16-nation euro zone.

-- Germany approves a 22.4 billion euro ($30 billion) share.

April 27 - Standard & Poor's downgrades Greece's credit rating to junk status. The next day it downgrades Spain's rating because of poor growth prospects.

April 23 - Papandreou asks for activation of EU/IMF aid.

April 22 - Eurostat says Greece's 2009 budget deficit was 13.6 percent of GDP, not the 12.7 percent it had reported.

April 11 - Euro zone finance ministers approve a 30 billion euro aid mechanism for Greece, but Athens has not activated it.

March 25 - European Central Bank President Jean-Claude Trichet says bank will soften rules on collateral for ECB loans, easing risk of Greek institutions being cut off from funding.

-- Euro zone leaders agree to create joint financial safety net, with IMF, to help Greece and restore confidence in euro.

March 5 - A new package of public sector pay cuts and tax increases is passed in Greece to save an extra 4.8 billion euros. VAT to rise 2 percentage points to 21 percent; public sector salary bonuses cut by 30 percent; tax on fuel, tobacco and alcohol rise; state-funded pensions frozen in 2010.

February 5 - Spain attempts to raise retirement age to 67 from 65, which prompts first and only mass union demonstration against the government.

February 2 - Papandreou says Greece will extend a public sector wage freeze to those making below 2,000 euros a month.

-- Greece must refinance 54 billion euros ($66.6 billion) in debt in 2010, with a crunch in second quarter as more than 20 billion euros becomes due and market yields for Greek debt soar.

January 29 - Spain announces plan to save 50 billion euros ($70 billion) including government spending cuts totaling 4 percent of GDP. The plan includes 4 percent cuts in public sector pay.

-- Economists are unsure it will meet its target of cutting deficit to 3 percent of GDP by 2013 from 11.4 percent in 2009.

January 14 - Greece unveils a stability program, saying it will aim to cut its deficit to 2.8 percent of GDP by 2012.

December 22, 2009 - Moody's cuts Greek debt to A2 from A1 over soaring deficits, the third rating agency to downgrade Greece.

December 9 - In Ireland, a budget delivers savings of over 4 billion euros. Public service pension age rises to 66 from 65.

December 16 - Standard & Poor's cuts Greece's rating by one notch, to BBB-plus from A-minus, saying austerity program is unlikely to produce a sustainable reduction in public debt.

Dec 8 - Fitch Ratings, which had cut Greece to A- when the higher deficit was revealed, cuts Greek debt to BBB+, the first time in 10 years it has been rated below investment grade.

November 20 - A final budget draft shows Greece aims to cut the deficit to 8.7 percent of GDP in 2010 to show EU partners and markets it is serious about restoring fiscal health.

November 5 - George Papandreou's new socialist PASOK party government says the 2009 budget deficit will be 12.7 percent of GDP -- more than double the previously published figure -- and pledges to save Greece from bankruptcy.

Writing by David Cutler, London Editorial Reference Unit;

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