February 21, 2012 / 12:15 PM / 7 years ago

Timeline: Greece's debt crisis

(Reuters) - Here is a look back at Greece’s financial crisis, after euro zone finance ministers sealed a 130-billion-euro ($172 billion) bailout for Greece on Tuesday to avert a chaotic default.

May 2, 2010 - Prime Minister George Papandreou says he has sealed a bailout deal with the EU and IMF in return for extra budget cuts of 30 billion euros ($39 billion) over three years. The package represents the first rescue of a euro zone member.

May 4/5 - Public sector workers stage a 48-hour nationwide strike. Three people are killed when a bank is set on fire.

May 6 - Greek parliament approves the austerity bill.

May 10 - Global policymakers install an emergency safety net worth about $1 trillion to bolster international financial markets and prevent the crisis from damaging the euro. This includes 440 billion euros in guarantees from euro zone states. EU ministers say the IMF will contribute 250 billion euros.

July 7 - Parliament passes a pension reform in line with the EU/IMF deal, and raises women’s retirement age from 60 to 65.


May 23 - Greece unveils planned privatizations as part of its goal to raise 50 billion euros by 2015 to reduce debts.

June 8 - Athens agrees extra austerity measures and savings up to 2015 to cut deficits and to keep receiving aid.

June 13 - Greece gets the lowest credit rating in the world after S&P downgrades it by three notches, to CCC from B.

June 17 - Papandreou reshuffles his cabinet, appointing his main party rival Evangelos Venizelos as new finance minister. The new cabinet wins a confidence vote on June 22.

June 29 - Papandreou wins a parliamentary majority in favor of the five-year austerity plan - thus securing new funding.

July 8 - IMF approves disbursement of 3.2 billion euros.

July 21 - Euro zone leaders agree on a second rescue package with an extra 109 billion euros of government money; private sector bondholders will contribute some 50 billion euros by mid-2014.

October 2 - Government draft budget figures predict a 2011 deficit of 8.5 percent of GDP, above target.

October 21 - Greece approves more austerity measures, defying violent protests in Athens and a general strike.

October 27 - Euro zone leaders beef up the rescue deal to an estimated 130 billion euros. They persuade private banks and insurers to accept a 50 percent loss on their Greek bonds - a figure which in subsequent negotiations will rise to 70 percent.

October 31 - In a shock move, Papandreou calls a referendum on the latest bailout without consulting European leaders.

— French President Nicolas Sarkozy and German Chancellor Angela Merkel tell Papandreou Athens will not receive any more aid until it votes in parliament to meet its commitments to the euro zone.

November 4 - After intense pressure from European leaders, the government confirms it has dropped referendum plans.

November 5 - Papandreou survives a parliamentary confidence vote, avoiding snap elections.

November 6 - Papandreou seals a deal with the opposition to form a coalition to approve the bailout before early elections. Under the agreement, Papandreou will stand down three days later.

November 10 - Former European Central Bank vice-president Lucas Papademos is appointed to head a new coalition. He says Greece will implement the bailout deal before calling elections.

November 24 - The IMF welcomes a written pledge from Antonis Samaras, leader of the conservative New Democracy party, backing the bailout deal.

December 6 - Violence breaks out at protests outside parliament in Athens. Some people are wounded and 38 people are arrested.

Dec 7 - The new coalition passes an austerity 2012 budget aimed at cutting the deficit to 5.4 percent of GDP (from what is now projected at nine percent in 2011) and at creating a 2012 surplus before interest payments are taken into account.

December 14 - The IMF says reforms are running behind schedule in most areas and that the delays are stalling recovery.


February 6 - An increasingly impatient Merkel tells Greece to hurry up on accepting the terms for the new EU/IMF bailout.

February 9 - After repeated delays and all-night talks with leaders of the three Greek coalition parties and EU and IMF inspectors, political leaders finally clinch a deal.

— Unemployment in Greece rises to 20.9 percent, a new record, as austerity measures choke economic growth. Greece’s two major labor unions GSEE and ADEDY call a 48-hour strike.

February 12 - Greek lawmakers endorse a new austerity deal after 10 hours of debate while thousands protest in Athens. Masked youths torch dozens of buildings and clash with riot police.

February 15 - Parties in the Papademos government give written undertakings to implement the austerity measures.

— Venizelos says the cabinet has agreed measures to plug a 325 million euro gap in the 3.3 billion euros of extra budget savings for 2012.

February 20/21 - Euro zone ministers meet in Brussels and after 13 hours of talks, ministers agree the 130 billion euro bailout, and finalize measures to cut Greece’s debt to 120.5 percent of GDP by 2020.

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