The European Commission has said Greece must provide "clarity" about its political and economic situation before it can get any new bailout aid.

Greece’s embattled prime minister and main opposition leader agreed to form an interim government to ensure the country’s new European debt deal, capping a week of political turmoil that saw Greece face a catastrophic default that threatened its euro membership and rocked international markets.

Talks are under way on the formation of a temporary coalition government in Greece to ensure the country does not go bankrupt in the next few weeks, a spokesman for the ruling administration has claimed.

Greece will suspend more civil servants than originally planned and impose new pension cuts as part of more austerity measures, the government said today, as it tried to persuade international creditors to continue bailout payments needed to avoid a chaotic default.