Greece is asking for a three-year bailout from its international creditors as pressure continues to grow over a potential financial meltdown.
On Wednesday, it pledged to start implementing some form of economic reform demanded by eurozone leaders before it can access an emergency fund.
The Wall Street Journal is reporting that everything depends on Prime Minister Alexis Tsipras making a drastic turnaround on pension cuts, tax increases and other austerity measures after five months of acrimonious negotiations.
Eurozone officials expect the request for more aid to be followed up by a full list of detailed policy changes and budget cuts that go beyond those that Greek voters overwhelmingly rejected in a referendum last weekend.
“The actual examination can only begin once the full package has been put on the table,” a spokesman for German Finance Minister Wolfgang Schauble was quoted as saying.
German Chancellor Angela Merkel said Tuesday night that a multi-year aid program would require measures, including changes to labor laws, product markets and the privatization of state assets, that had been dropped from negotiations in recent months.
As a sweetener, eurozone leaders offered to start discussing measures on how to ease Greece’s immense debt burden.
They suggested that short-term financing to help meet a €3.5 billion (US$3.8 billion) bond payment to the European Central Bank on July 20 could be part of a broader, longer-term deal.
Pending an agreement, Greece can no longer draw from the €245 billion in rescue loans that have kept it afloat for the past five years.
On June 30 the eurozone portion of that bailout expired while the country’s default on a €1.56 billion payment to the International Monetary Fund last week has made Athens ineligible for more help from it.
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