AP
EC president Jose Manuel Barroso said politics and the international money markets had come together for the first time to tackle the crisis (AP)
Eurozone leaders have agreed to support a new bailout for Greece which gives the debt-laden nation a lower interest rate and more time to pay it off.
The softer lending conditions will also be applied to the multibillion-euro rescue loans for Ireland and Portugal as heads of state battle to prevent debt contagion spreading deeper across Europe and possibly going global.
At an emergency summit in Brussels, the European leaders opted to double the maturity of the loans for the three bailed-out countries from seven-and-a-half years to 15 years, and cut the interest rate in an attempt to finally ensure the stability of the single currency.
In a joint statement, the leaders said: "We agree to support a new programme for Greece and, together with the IMF and the voluntary contribution of the private sector, to fully cover the financing gap.
"The total official financing will amount to an estimated 109 billion euro (£95.9 billion). This programme will be designed, notably through lower interest rates and extended maturities, to decisively improve the debt sustainability and refinancing profile of Greece."
European Commission president Jose Manuel Barroso said for the first time in the crisis, politics and the international money markets had come together.
"We needed a credible package, we have a credible package," Mr Barroso said. "It deals with both the concerns of the markets and citizens.
"It responds also to the concerns of all member states of the euro area. It is a package that every government has signed up to. For the first time in the crisis, politics and markets are coming together."
UK Chancellor George Osborne said: "The first thing British taxpayers should know is that we have delivered on our promise to keep the UK out of the Greek bailout. But Britain also has a huge interest in a stable eurozone. Today's package from eurozone countries to support Greece is an important and positive development.
"Even more positive is the demonstration that eurozone political leaders can take decisive economic action. That is what they now have to sustain, not just on the details of this package, but also on the longer term changes needed to make the euro work. They have shown they can get a grip, now they need to keep it."
