Business

Cameron 'wins fight' to limit aid UK will give Greece

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Media captionDavid Cameron: European banks must make Greek exposure clear

David Cameron has won his battle to limit the amount of money the UK will have to contribute towards a second financial bail-out for Greece.

The current 110bn euros ($156bn; £98bn) Greek rescue package is a combination of funds from fellow eurozone nations and the International Monetary Fund.

With a second bail-out due in the autumn, there had been a suggestion cash from EU-wide funds may be used.

This will now not happen, but the UK will still contribute via the IMF.

"This is the right outcome for the British taxpayer," a Downing Street source told the BBC after the vote.

The confirmation that the European contribution to the second Greek rescue package will again be limited to eurozone countries - those that use the single currency - was made in Brussels by European Council President Herman Van Rompuy.

Mr Rompuy was speaking at the end of the first day of a summit of EU leaders, which Mr Cameron is also attending.

The European money currently being given to Greece comes from the European Financial Stability Facility, to which only the 17 eurozone nations contribute.

The UK instead contributes to the wider European Financial Stabilisation Mechanism, which covers the whole of the EU.

The Greek parliament will vote next week on the government's latest round of spending cuts.

If the vote goes through, then Greece will get the next 12bn euros instalment of the current 110bn euros of eurozone and IMF funds.

Greece needs this money by 15 July, or else it will default on its loan payments.

However, many economists think that even if Greece gets the latest 12bn euros it will still default at some time in the future.

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