Finance chiefs draw up Greek bailout text

Negotiations led by Jeroen Dijsselbloem, the Dutch finance minister who chairs the eurogroup of 19 eurozone finance ministers, have produced a common communique on the extension of Greece's €172bn bailout, according to a eurozone official.

The text was produced after nearly five hours of bilateral talks between Mr Dijsselbloem and key ministers, including Yanis Varoufakis, Greek finance minister, and Wolfgang Schauble, his German counterpart. The eurozone official also said Mr Dijsselbloem was in direct contact with Alexis Tsipras, Greek prime minister, during the talks.

The text must now be presented to all 19 eurozone ministers for approval. "It will be fast," said the official.

According to a Greek government official, the new text was also agreed by the three institutions that monitor the country's bailout: the European Commission, the European Central Bank and the International Monetary Fund.

The Greek official also said Mr Tsipras had spoken with Donald Tusk, president of the European Council, requesting an EU summit if no deal could be reached at the eurogroup meeting on Friday night.

Mr Varoufakis had earlier insisted that Greece had made sufficient concessions to reach a deal to extend the bailout for six months after it expires next week and predicted that he and his 18 eurozone counterparts would reach an agreement.

He said Athens had "gone not an extra mile [but] an extra 10 miles" in its proposal for the extension, submitted to eurozone leaders on Thursday, adding it was now the turn of other ministers to meet Greece "not half way, but one-fifth of the way" to reach a deal.

"I have no doubt that there is going to be a very collegial discussion, and hopefully at the end of this we will come out with some white smoke," Mr Varoufakis said as he arrived for the third eurogroup meeting in a week.

Friday's meeting had been delayed for 90 minutes by Mr Dijsselbloem as a core group of ministers and EU leaders held pre-meeting sessions in an attempt to iron out differences.

Mr Dijsselbloem said those meetings would "cost some time" and had proved "quite complicated", casting doubt whether a deal could be reached. "There is still reason for some optimism, but it's very difficult," he said during a brief break between the sessions.

Mr Varoufakis and a group of German-led eurozone countries are locked in a stand-off over the conditions of a bailout extension, with Berlin insisting the new Greek government agree to the terms of the existing bailout before it engages in negotiations over any changes in the programme.

Mr Tsipras's government has refused, saying it was elected to end the current bailout, but has made significant concessions, agreeing to ask for an extension with some loopholes that would give it some leeway to negotiate terms.

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"There is a need for significant improvements in the substance of what is being discussed so that we can vote on it in the German Bundestag, for example next week," Ms Merkel said, standing next to her French counterpart, Francois Hollande.

The pressure on Greece to reach a deal has risen significantly in recent days, with eurozone capitals largely maintaining a united front in insisting Athens adopt the strictures of the current bailout as a condition for further talks. In addition, officials said there are growing signs Athens is running out of cash, making its need for bailout funding increasingly urgent.

But going into the talks, Athens continued to take a tough stance. Nikos Pappas, one of Mr Tsipras' closest advisers, said the government would not budge on the language of its extension request.

<>"Our letter will not change," Mr Pappas said. "It has the signature of the finance minister. Either a solution will be found or it won't. There are no halfway solutions. It's a moment of high political responsibility."

Mr Pappas added that if a deal was not found among finance ministers on Friday, his government would request a special eurozone summit of heads of government to find a solution.

"If there's no agreement, I think the issue will be addressed through political interventions at a higher level," Mr Pappas said. "We are making clear that we're not joining the discussion to make requests but to negotiate."

Additional reporting by Adam Thomson in Paris and Jeevan Vasagar in Berlin

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