Obstacles remain for Greek bailout deal

BRUSSELS — Greece faces further hurdles and delays before it can receive a second, €130 billion ($171 billion) bailout in spite of its lawmakers voting through more austerity measures in the face of violent protests.

The European Union's Economic Affairs Commissioner Olli Rehn on Monday called the Greek parliament's approval of a further round of budget cuts a "crucial step forward," but Germany insisted it will still take some time before the second bailout is delivered.

Germany, which as Europe's biggest economy pays the largest part in bailout deals, said it won't give its final approval for the new aid payments until early March — after it is clear how well a debt relief deal with private bond holders would work and its parliament has voted on the new measures.

Pushing the new bailout back for several weeks underlines how much distrust has built up against Greece over the past two years, when many promised cuts and reforms were passed in Parliament but never actually implemented.

But it also means that Greece, its citizens and the rest of the world economy won't know for several weeks whether the country can avoid a potentially disastrous default. A bankruptcy could push Greece out of Europe's euro currency union, drag down other troubled eurozone countries and further roil global markets.

Greece's political leaders scrambled over the weekend to get new far-reaching austerity measures through Parliament ahead of a meeting of the finance ministers from the 17 euro countries on Wednesday. The drastic cuts debated on Sunday included axing one in five civil service jobs over the next three years and slashing the minimum wage by more than a fifth.

As Greek lawmakers voted on the new cuts, the streets of Athens and other cities were rocked by violent protests. In Athens, at least 45 buildings were burned while dozens of stores and cafes were smashed and looted. Police arrested at least 74 people and detained a further 92, while in several cases they had to escort fire crews to burning buildings after protesters prevented access.

However, the Greek Parliament's vote hasn't brought an end to the uncertainty. Apart from some technical decisions, several key issues remain:

—It is unclear whether the new spending cuts, the debt relief deal and the new bailout will be enough to bring Greece's debt load down to 120 percent of economic output by 2020 — the maximum its international creditors perceive as sustainable.