Creditors Propose 5-month Bailout Extension To Greece

(RTTNews) - Greece's creditors have proposed a five-month extension of its current bailout programme if the government agrees to a set of reforms, reports said citing officials and leaked documents.

The country's massive EUR 240 billion bailout will be extended till the end of November, when a total EUR 12 billion aid will be offered. The current programme is set to expire at the end of this month and extension could give more time to hold negotiations between Greece and creditors to reach a feasible solution.

News agencies reported that Greece may be given EUR 1.8 billion as the first tranche to meet a EUR 1.6 billion payment due to the International Monetary Fund on June 30. The money will come from profits made by the European Central Bank's holdings of Greek bonds.

The disbursement will be possible only if the Greek parliament approves the proposal and adopts first set of reforms. The offer will also require approval from other euro zone parliaments.

Talks between creditors - the European Commission, the ECB and the IMF - and Greek Prime Minister Alexis Tsipras failed to produce any deal on Thursday and a Eurogroup meeting later on apparently saw proposals from both sides.

After intense drama in the run up to a European Council summit on Thursday, it was announced that differences remained and euro area finance ministers will meet again on Saturday.

Saturday's meeting is scheduled for 17 hrs Brussels time, the Eurogroup said in a statement on Friday. That was rescheduled for 14 hrs later on.

"The institutions are assessing the Greek authorities' latest proposal, submitted on 25 June 2015," the statement said.

"The Eurogroup will continue the discussion on the ongoing negotiations between Greek authorities and the institutions."

Elsewhere in Brussels on Friday, Tsipras met German Chancellor Angela Merkel and French President Francois Hollande ahead of the crucial meeting on Saturday as pressure mounts on both side to reach a solution.

It is crucial to reach a deal by Saturday or Sunday, so that it can go for both Greek and euro area parliaments approval, at the latest by Monday.

The Greek state-backed ANA-MPA news agency quoted Tsipras as saying, "continue to fight on behalf of the European people, and of course the Greek people."

"The European Union's founding principles were democracy, solidarity, equality and mutual respect. These principles were not based on blackmails and ultimatums."

Amid all the confusion, comments from politicians and officials suggest both Greece and the EU hope that the former remains in the euro area in the end.