Eurozone leaders make plans to pull back from the brink

Short term financing and a longer term programme with widespread changes to the Greek economy were on the table last night but EU leaders gave Greece a final deadline of Sunday to submit detailed plans.

Eurozone leaders make plans to pull back from the brink

There were some initial surprises when the new finance minister Euclid Tsakalotos, failed to produce the document fellow finance ministers were expecting to spend a few hours discussing.

There were various reports including one that was denied by a spokesperson for the president of the eurogroup, Jeroen Dijsselbloem, that he advised Mr Tsakalotos to rework the proposals when he had sight of them before the meeting.

A photograph of the new minister arriving at the meeting showed him carrying a stack of papers with a note on one saying “no triumphalism”, but whether his file included a set of proposals or not was unclear.

While this appeared to be a very bad start to what was to be the last chance for Greece to get the aid it desperately needed, the attitude among both finance ministers and leaders had changed from the fractiousness of the past few weeks.

The document has been promised to arrive today and finance ministers will discuss it in a conference call before handing it over to experts for a technical assessment from the various institutions to consider the numbers and see if they add up.

It is expected they will work off the same programme that was rejected in Sunday’s referendum but possibly eliminating proposals to scrap collective bargaining, some labour market reforms and pension cuts and offering substitutes.

This would possibly release the funds that were taken off the table last week, or at least some of it, which should help the economy from imploding, and help them meet the €3.5bn due to the ECB on July 20.

After the eurogroup meeting Mr Tsipras met Ms Merkel, French President Francois Holland and president of the Commission Jean Claude Juncker and this appeared to set the tone for the summit.

Mr Tsipras presented his request for a third bailout programme. EU Council President Donald Tusk said the details for this had to be in by Sunday at the latest. If Sunday’s summit of all 28 leaders agree to accept it, it would then have to be voted for by the Greek and German and some other governments before negotiations could begin.

France, which has been Greece’s biggest eurozone ally, is pushing for a deal in which Athens accepts and passes the budgetary measures — with limited changes — that were in the plan that was rejected by Greek voters in their referendum.

Greece would then receive immediate financing and the prospect of a future restructuring of its debt, a senior French official said. Leaders heard from the ECB’s Mario Draghi and from Mr Dijsselbloem as well as from Mr Tsipras and most others before indicating they would open negotiations on a third bailout.

The ECB may consider increasing the ELA available also to help the Greek banks.

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