An agreement was reached late on Thursday between Greece and its lenders on the austerity plan aimed at rescuing the Balkan country from default.

Greek Prime Minister George Papandreou must now push through Parliament in order for Greece to stave off default.

The new bailout package, to be outlined by early July, will include loans from other Euro Zone countries. It will also feature a voluntary contribution from private investors, who will be invited to buy up new Greek bonds as old ones mature.

Greece needs the loan to be able to keep up with payments to creditors of its EUR 340 B of debts, which amounts to EUR 30 000 per person.

Olli Rehn, the European Commissioner for Economic and Monetary Affairs, stated the European Union was prepared to give Greece some stimulus spending — something numerous economists have suggested would help Greece emerge from its "debt trap," in which it is unable to return to growth while slashing state spending, the New York Times reports.

On Wednesday, the Greek cabinet survived a critical confidence vote in its attempt to secure support for additional austerity measures and avoid bankruptcy of the State.

Prime Minister George Papandreou's new cabinet was approved by 155 votes to 143, with two abstentions. Despite the threat of a rebellion within Papandreou's ruling Panhellenic Socialist Movement (PASOK), the vote was strictly along party lines.

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