Greece given deadline to come up with proposal for debt deal

PanARMENIAN.Net - Eurozone members have given Greece until the end of the week to come up with a proposal for sweeping reforms in return for loans that will keep the country from crashing out of Europe's currency bloc and into economic ruin, Reuters reports.

"The stark reality is that we have only five days left ... Until now I have avoided talking about deadlines, but tonight I have to say loud and clear that the final deadline ends this week," European Council President Donald Tusk told a news conference.

Prime Minister Alexis Tsipras has until Friday, July 10, to present the proposal, but German Chancellor Angela Merkel said she hoped to have convincing reform commitments from Tsipras on Thursday so she could ask the German parliament to authorize negotiations on a new aid program.

Merkel said she was "not exaggeratedly optimistic" for a solution.

At an emergency summit in Brussels on Tuesday, representatives of the 19-country eurozone said all 28 European Union leaders would meet on Sunday to decide Greece's fate. The talks were organized after Greeks voted in a referendum on Sunday against a bailout that carried stringent austerity measures.

French President Francois Hollande said the European Central Bank would ensure that Greek banks had the minimum necessary liquidity to stay afloat until Sunday.

The situation in Greece worsened with banks closed for a second week, limited cash withdrawals and businesses feeling the crunch of demands from vendors for cash payments.

Tsipras sounded upbeat as he left the summit, even though many of the reforms demanded by his partners would inflict more pain on Greeks who voted at his behest to reject the austerity measures in return for financial aid.

"The discussion took place in a positive climate," he said. "The process will be extremely fast. It starts in the coming hours, with the aim to conclude by the end of the week at the latest."

He promised to work for a socially just deal that would bring a "final exit" from the crisis, return Greece to growth and restructure Greek debt to make it viable.

Under a timetable agreed by the 19 leaders of the common currency area, Greece will submit on Wednesday a formal request for a two-year loan program, with a first list of reform commitments to be spelled out in greater detail on Thursday.

If the European Commission, the International Monetary Fund and the European Central Bank approve, Eurogroup finance ministers will meet on Saturday to recommend opening negotiations on a conditional assistance program.