Greece to get €109-billion bailout

The decision follows  last-ditch talks for seven hours in Berlin on Wednesday between French President Nicolas Sarkozy and German Chancellor Angela Merkel - the leaders of the two largest economies in the eurozone -  that ironed out differences over how to combat the continent's spreading debt contagion and adopt a common position ahead of the European summit. (See: Germany, France reach accord on euro debt crisis before the European summit)

According to German chancellor Angela Merkel, this was the right signal at an important time.

The new aid would come in addition to the €110-billion bailout that Greece received last year from eurozone countries and the International Monetary Fund (IMF).

''The problems the euro area is facing could only be saved at the highest level. We had to act quickly - convening this meeting focused the minds and accelerated finding a solution,'' European Union president Herman Van Rompuy told reporters.

New loans to Greece would have a maturity of 15 to 30 years as against 7.5 years of last year's bailout, while the interest rate would fall from 5.5-6 per cent to about 3.5 per cent. The concessions would be extended to fellow bailout recipients Ireland and Portugal.

Greece would save €30 billion with the rate decrease alone according to French president, Nicolas Sarkozy.