Greece debt agreement

Euro zone finance ministers attend eurogroup meeting following Greek agreement

Sorcha Pollak, Ciara O'Brien Mon, Jul 13
 
LIVE: Greece debt agreement

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  • 07:04
    Good morning, 15 hours into talks on a third eurozone bailot and still no agreement has been reached. Euro zone leaders talked through the night in Brussels with Greek PM Alexis Tsipras coming under intense pressure to adopt loan preconditions and deeper austerity measures to keep Greece in the single currency.
  • 07:06
    Our reporters Fiach Kelly and Derek Scally have filed this early morning update.
  • 07:12
    It was an extraordinary weekend in the history of the EU with German chancellor Angela Merkel and French president Francois Hollande presenting Tsipras on Sunday with an ultimatum: accept a series of draconian measures to avoid financial collapse and euro exit.
  • 07:17

    But the Greek prime minister is holding firm on two demands, having the IMF involved in a proposed new three-year bailout and parking €50 billion in assets outside of Greece, probably in Luxembourg, as collateral for new loans.

    The result is the marathon session of talks. Really this was supposed to be over and done with yesterday. "Today was not supposed to happen," as a colleague here just said. It will be interesting then to see how the morning unfolds.

  • 07:23
  • 07:24
  • 07:36

    Finland is reportedly in favour of booting Greece out of the euro. But at least their finance minister Alexander Stubb has offered his sympathies to the participants in the marathon talks. "I wake up after a good [?] to learn that #EUCO is still going on," he tweeted this morning.

    And Stubb should know a thing or two about endurance--according to his Twitter he's  a sub-10 hour Ironman.

  • 07:42
  • 07:47
    Now Reuters are saying Belgian prime minister Charles Michel has said from the eurozone summit there is "agreement".
  • 07:51
    If that's true, and at this stage who knows if it actually is, it would mean the euro zone leaders have agreed a deal on a third bailout package for Greece about 17 hours after entering talks. That's seven hours longer than it takes Finnish finance minister Alexander Stubb to complete an Ironman triathalon.
  • 07:55
  • 08:01
    European Council president Donald Tusk has reconvened the euro summit, a number of leaders are saying or tweeting that a deal has been agreed.
  • 08:04

    From Irish Times Berlin Correspondent Derek Scally in Brussels:


    Reports that a deal has been reached between Francois Hollande, Angela Merkel, Alexis Tsipras and EU Council president Donald Tusk. Agreement would then go to the eurgroup plenary for approval of all leaders.

    The possibility of a deal was tweeted first by Charles Michel, the Belgian prime minister. After almost 17 hours (and counting), a fresh delivery of croissants has arrived in the European Council building canteen, picked bare overnight by journalists.

    A BBC journalist punches the air in delight on his way to a live.

  • 08:10
  • 08:11
    Press conference happening in Brussels right now...
  • 08:14
    European Council president Donald Tusk says the summit has reached an "agreekment"  
  • 08:18

    Reports from the Euro group summit press room:

    "Trust was a key issue. We worked hard on the issue of reforms, debt problems, financing needs. We were able to agree on a alot of these issues, putting an extra effort in on all sides to get Greece back on track."

  • 08:23

    Dutch Finance Minister Jeroen Dijsselbloem:

    “You will find in the agreement some of the issues have been brought forward. The Greek parliament will legislate on a number of issues. This will help to bring back trust.”

    Mr Dijsselbloem has said “concrete agreements” have been met on where the Greek proposals need to be strengthened further.

    He said a fund will be set up with assets to be transferred to the fund. “That money will be used to deal with debt and to reduce debt.”

  • 08:24
  • 08:24
    Angela Merkel is now speaking about the agreement reached after more than 17 hours of talks...
  • 08:25
    Mr Dijsselbloem said in the press conference the Greek government must immediately begin to pass legislation to implement the measures agreed at the summit talks.  
  • 08:28
  • 08:32

    Here’s the latest from our correspondent in Greece, Damian Mac Con Uladh:


    Now that a “unanimous” agreement has been reached in Brussels, attention will now return to Athens, where the government has been given just a matter of days to push the new deal through parliament.
    But Alexis Tsipras is facing open rebellion in his party over the deal.


    In a crucial vote in the early hours of Saturday, 17 Syriza MPs, including some ministers and the parliamentary speaker, refused to back for the cost-cutting package that the government would take to Brussels. The proposals were only passed with the help of opposition parties.


    Other leading Syriza ministers have suggested that those ministers will now have to be sacked. Another minister has suggested that party MPs who refuse to back the government should give up their seats. A reshuffle is certainly on the cards and snap elections are a distinct possibility unless Alexis Tsipras brings in other parties into his coalition. But a few days ago, he indicated that he would be unwilling to lead such a government.

  • 08:35
  • 08:41
  • 08:44

    “A new European winter”

    Expressing the outrage of many in the party is today’s editorial in Syriza’s own newspaper Avgi, not only is there an “attempt at criminal extortion” in Brussels, it claims a “coup is underway to overthrow the legally elected government in Greece and the audacious Tsipras”, writes Damian Mac Con Uladh.

    The Greek people are being “punished vindictively in a way only Germany knows how”, it continues, stating that “Greece and the Syriza government will be the first victims of this new European winter” that will “bury” the postwar achievements on the continent and the hopes for a “democratic Europe”.

    “It may be the beginning of the end for the EU itself.”

    “Germany is not entitled to destroy Europe for the third time in 100 years. The civilised world has no right to allow this. And Greece cannot tolerate it.”

  • 08:45
    Greek prime minister Alexis Tsipras is speaking live following the announcement of a unanimous agreement on the Greek bailout.  
  • 08:49
    Mr Tsipras says Greece gave a tough battle and faced hard decisions and tough dilemmas. He said he's taken the responsbility to avert the extreme plans of conservative circles.  
  • 08:49
  • 08:52

    “The heart of our civilisation”

    The head of the European Commission, Jean-Claude Juncker, says the deal means Athens will not be forced out of the single currency.

    French President Francois Hollande — who has been among the strongest supporters of the radical left Syriza government in its attempts to reach a settlement with its creditors — warmly welcomed the agreement.


    He said that to have lost Greece as a member would have been to lose “the heart of our civilisation” and called on the Greek parliament to convene within hours to adopt the new package of austerity measures.

  • 08:52
  • 08:53
  • 08:59

    Francois Hollande: We have reached an agreement. France was seeking this, it wanted this. Greece will remain in the euro zone. Europe has won.  

  • 09:04

    Tasoieach Enda Kenny has spoken to RTÉ Morning Ireland following the agreement in Brussels.

    He described the Greek talks as “a pretty bruising experience”, saying the agreement would allow for a document that will agree the basis for negotiations of a third programme for Greece.

    “This will allow the Greek economy to thrive and prosper and remain a member of the euro zone.”

    “Europe should not do anything to cause a Grexit as it has been referred to,” said the Taoiseach. “This is a challenging position for Greece but one the prime minister says he’s up for.”

    Mr Kenny said the “sticking points” of the talks, which included the involvement of the IMF and the €50 billion fund, had been “settled and agreed”.

  • 09:07
  • 09:10

    Internal rebellion

    Reporting from Greece, Ruadhán Mac Cormaic writes that the insistence by the Germans, the Finns and others that Athens should accept more austerity, and implement some of it immediately as a precondition for talks on a bailout, will solidify a sense within Syriza that the creditors are out to humiliate the party.

    That will have real political consequences in Athens, where Tsipras is already struggling to keep his party onside. He won the parliamentary vote on Saturday thanks only to the opposition’s support, as 17 Syriza members either voted No, abstained or didn’t show up. In effect he lost his majority.

    Given at least a dozen more Syriza MPs say they will not vote for austerity measures, that will make it difficult for Tsipras to introduce VAT increases, make cuts to a top-up payment for poorer pensioners and pass other unpopular laws he has committed to enacting.

    In theory he could stagger on, relying on the opposition to win each vote. But his authority would slowly diminish and the internal rebellion would become difficult to contain.

    Quite soon he may well have no choice but to reconfigure his government or call an election, plunging Greece into yet more political turmoil at the worst possible moment.

     

     

  • 09:11
  • 09:13
  • 09:26
  • 09:35

    Greece blinked first

    In the early hours of Monday morning, Irish Times Foreign Affairs correspondent Ruadhán Mac Cormaic wrote that Greece had blinked first.

    He wrote: In a 13-page document sent to its international lenders last Thursday night, Alexis Tsipras’s government agreed to a raft of spending cuts and tax increases that look almost identical to proposals it rejected just two weeks ago.

    "Less than a week after the Greek electorate, encouraged by the ruling Syriza party, opted for an emphatic No, Tsipras said Yes. The policy reversal stunned some of his colleagues and left No voters angry and disillusioned.

    How can he sell this, and will his party accept it?

    In the early hours of Saturday morning, as he sought to persuade Greek MPs to give his government the green light to negotiate with the creditors, Tsipras was candid and upfront. Looking drawn and weary, he made no attempt to pretend this was what Syriza promised when it came to power in January, or what it had spent the past six months fighting for.

    Broadly, his explanation was along these lines: Syriza did everything humanly possible to get a better deal. Yes, we made mistakes, we were inexperienced, but we pushed hard and brought the negotiations to the wire. We tried to strengthen our negotiating hand through the referendum, in the hope the lenders would be persuaded by the power of a democratic vote. But it didn’t work.

    We came up against some powerful and doctrinaire opponents, some of whom were determined to get Greece out of the euro zone, using economic problems as a pretext for what became a political objective. We were pressured and, at worst, blackmailed. Now they have presented us with an ultimatum: sign on the dotted line or leave the euro zone.

  • 09:42

    Here's the full statement from European Council president Donald Tusk from this morning's press conference in Brussels following the Greek agreement.  

    "Good morning. Today, we had only one objective: to reach an agreement. After 17 hours of negotiations, we have finally reached it. One can say that we have agreekment. Leaders have agreed in principle that they are ready to start negotiations on an ESM programme, which in other words means continued support for Greece.

    "There are strict conditions to be met. The approval of several national parliaments, including the Greek parliament, is now needed for negotiations on an ESM programme to formally begin.

    "Nevertheless, the decision gives Greece a chance to get back on track with the support of European partners. It also avoids the social, economic and political consequences that a negative outcome would have brought. I welcome the progress and the constructive position of Greece that helps to bring back trust among euro zone partners.

    "Following national procedures, the Eurogroup will work with the Institutions to swiftly take forward the negotiations. Finance ministers will also as a matter of urgency discuss how to help Greece meet her financial needs in the short term, so-called bridge-financing.

    "I would like to thank the president of the commission Jean-Claude Juncker and the Eurogroup president Jeroen Dijsselbloem for their dedication and involvement in this progress. Without your work, today’s agreement wouldn’t be possible. Thank you."

  • 09:44
  • 09:53

    Here’s a reminder of what Taoiseach Enda Kenny said earlier this morning following the Greek agreement from our Brussels correspondent Suzanne Lynch.

    The Taoiseach said the negotiations had been “bruising” but he welcomed that the basis for a third agreement had been reached.

    “This has been a pretty bruising experience over the last period, but what it has allowed for is the basis for a third agreement for Greece which will allow for the Greek economy to thrive and prosper and continue to remain a member for the euro zone,” he said.

    He said that the involvement of the IMF in a programme and the establishment of a €50 billion fund had been the main sticking points during the discussion.

    He added that 25 per cent of the proceeds of the fund will be used for investment, with the remainder used for debt reduction.

    Asked about the Greek position on the final deal, he said: “This is a challenging position for Greece, a very challenging position, but it is a challenge the prime minister has said he is up for.”

    He said that the agreement now had to go to various national parliaments, including the Greek parliament.

    “It is hoped that this now can go through the Greek parliament with assistance from all sides and will form the basis of a third programme.”

  • 09:59
    A man reads newspaper headlines in central Athens. Greece has reached a desperately-needed bailout deal with the eurozone after marathon overnight talks, in a historic agreement to prevent the country crashing out of the European single currency. <br /><br />Greek prime minister Alexis Tsipras agreed to tough reforms after 17 hours of gruelling negotiations in return for a three-year bailout worth up to €86 billion euros, Greece's third rescue programme in five years. Photograph: Aris Messinisaris/AFP/Get
    A man reads newspaper headlines in central Athens. Greece has reached a desperately-needed bailout deal with the eurozone after marathon overnight talks, in a historic agreement to prevent the country crashing out of the European single currency.

    Greek prime minister Alexis Tsipras agreed to tough reforms after 17 hours of gruelling negotiations in return for a three-year bailout worth up to €86 billion euros, Greece's third rescue programme in five years. Photograph: Aris Messinisaris/AFP/Get
  • 10:17

    The EU Council press office has published online the Euro summit statement from the Greek talks.

    The Euro Summit document underlines the “crucial need to rebuild trust with the Greek authorities” as a prerequisite for a possible future agreement on a new ESM programme.

    It writes that a “euro area Member State requesting financial assistance from the ESM is expected to address, wherever possible, a similar request to the IMF”.

    “Therefore Greece will request continued IMF support (monitoring and financing) from March 2016.”

    The measures to be introduced by Greece under the agreement are:

    By July 15th ...

    - The streamlining of the VAT system and the broadening of the tax base to increase revenue

    - Upfront measures to improve long-term sustainability of the pension system as part of a comprehensive pension reform programme

    - The safeguarding of the full legal independence of ELSTAT

    - The full implementation of the relevant provisions of the Treaty on Stability, Coordination and Governance in the Economic and Monetary Union, in particular by making the Fiscal Council operational before finalizing the MoU and introducing quasi-automatic spending cuts in case of deviations from ambitious primary surplus targets after seeking advice from the Fiscal Council and subject to prior approval of the Institutions;

    By July 22nd...

    - The adoption of the Code of Civil Procedure, which is a major overhaul of procedures and arrangements for the civil justice system and can significantly accelerate the judicial process and reduce costs;

    - The transposition of the BRRD with support from the European Commission.

  • 10:25

    The statement from the Euro Summit says the Greek government must “formally commit” to strengthening their proposals with a “satisfactory clear timetable” for legislation and implementation.

    It writes that under the summit agreement, the Greek government must:

    - Carry out ambitious pension reforms

    - Adopt more ambitious product market reforms with a clear timetable for implementation of all OECD recommendations

    - On energy markets, proceed with privatisation of the electricity transmission network operator

    - On labour markets, undertake “rigorous reviews and modernisation” of collective bargaining, industrial action and collective dismissals

    - Adopt necessary steps to strengthen the financial sector

  • 10:26
  • 10:32

    Irish Times Managing Editor Cliff Taylor writes: there will be a lot of talk today about whether, after the marathon summit, the bailout deal can cross the remaining hurdles and be put in place.

    However first there is some urgent business to take care over. Greece has some hefty bills coming up, including €3.5 billion due to the ECB on July 20th, interest on that payment, plus the €1.5 billion in arrears due to the IMF, and a similar sized IMF payment in the offing.

    So euro zone finance ministers will meet this afternoon (they haven’t seen each other for a while, after all) to agree how to provide €7 billion in interim financing by next Monday. There are various ways this can be done technically. Interesting to see how quickly this meeting is over...

    The second meeting is the ECB governing council – presumably by teleconference – which has to decide what to do with the emergency liquidity it supplies to Greek banks. Wire service reports suggest it may decide to keep emergency assistance at its current level.

    It is not clear how much cash the banks have left so this will be a key theme in the next few days. Whatever happens the banks will not reopen fully for a long time, but the first job will be to stop any of them actually collapsing.

  • 10:37
    Prime Minister of Greece Alexis Tsipras gives a press conference at the end of Eurozone leader summit on the Greek crisis, at the European Council headquarters in Brussels. Eurozone leaders have agreed to a new bailout programme for Greece. Photograph: Stephanie Le Cocq/EPA
    Prime Minister of Greece Alexis Tsipras gives a press conference at the end of Eurozone leader summit on the Greek crisis, at the European Council headquarters in Brussels. Eurozone leaders have agreed to a new bailout programme for Greece. Photograph: Stephanie Le Cocq/EPA
  • 10:43
  • 11:01

    Historical comparisons  

    Berlin Correspondent Derek Scally is reporting from Brussels where German chancellor Angela Merkel gave a statement earlier this morning following the announcement of a Greek agreement.

    He writes that “only her eyes, a little glassier than usual, suggested that Dr Merkel had just come out of an all-night game of high-stakes euro poker, following seven months of Syriza strife and a week of post-referendum uncertainty”.

    “The German leader got straight down to business, presenting a long shopping list of reform measures to the press, from VAT hikes to pension reform, many of which Greece must get through its parliament within 48 hours or forfeit today’s deal.

    "Only if laws are passed in the agreed timeframe, she added, could the chancellor “wholeheartedly” ask the Bundestag to give her government a mandate to negotiate a third aid programme.2

    Have European leaders, 96 years on, just agreed to a new Versailles Treaty, asks Scally.

    “The Greek fingerprints are there in the form of the high level of financing needs,” remarked Dr Merkel drily, to titters from the German press. “I won’t participate in historical comparisons, particularly ones I didn’t make myself.”

  • 11:03

    So, what’s next for Greece?

    Derek Scally writes that only if Athens ticks all the boxes it has signed up to and implements them in the ambitious timeframe agreed, will eurogroup leaders look at making Greek debt more sustainable.

    And even then, it will only involve longer grace periods for Greek debt – a proposal agreed in November 2012.

    To avoid any confusion about what was on offer, the German chancellor Angela Merkel said this morning : “We made clear that a nominal haircut is ruled out”.

  • 11:05
  • 11:18

    Economist Paul Krugman has described the Eurogroup list of demands as “madness”. In an opinion piece, Krugman writes that the trending hashtag #ThisIsACoup is exactly right.

    “This goes beyond harsh into pure vindictiveness, complete destruction of national sovereignty, and no hope of relief,” he writes. “It is, presumably, meant to be an offer Greece can’t accept; but even so, it’s a grotesque betrayal of everything the European project was supposed to stand for.”

    “In a way, the economics have almost become secondary. But still, let’s be clear: what we’ve learned these past couple of weeks is that being a member of the eurozone means that the creditors can destroy your economy if you step out of line. This has no bearing at all on the underlying economics of austerity.

    “It’s as true as ever that imposing harsh austerity without debt relief is a doomed policy no matter how willing the country is to accept suffering. And this in turn means that even a complete Greek capitulation would be a dead end.”

    “The European project — a project I have always praised and supported — has just been dealt a terrible, perhaps fatal blow. And whatever you think of Syriza, or Greece, it wasn’t the Greeks who did it.”

  • 11:38

    Greece’s reform minister George Katrougalos told BBC radio this morning that “clearly the Europe of austerity has won”.

    "Either we are going to accept these draconian measures or it is the sudden death of our economy through the continuation of the closure of the banks. So it is an agreement that is practically forced upon us."

  • 11:47
    News coming in from Brussels has quietened down quite a lot over the past hour. This may be why... journalists at the European Council headqaurters grab some shut-eye after reporting on more than 17 hours of euro summit talks. Photograph: Oliver Hoslet/EPA
<p>  </p>
    News coming in from Brussels has quietened down quite a lot over the past hour. This may be why... journalists at the European Council headqaurters grab some shut-eye after reporting on more than 17 hours of euro summit talks. Photograph: Oliver Hoslet/EPA

     

  • 11:52
  • 11:59
    A senior EU official has calculated the cost to the Greek state of the last two weeks of political and economic turmoil at €25 to €30 billion, according to Reuters. A euro zone diplomat said the full damage might be closer to €50 billion.  
  • 12:00
  • 12:04

    Ruadhán Mac Cormaic is reporting from Athens that Greek prime minister Alexis Tsipras will face a struggle to keep his majority in parliament after a number of government figures distanced themselves from the deal with creditors.

    He says a rebellion in the ruling Syriza party has been on the cards since Saturday morning, when 17 of the party’s MPs failed to vote to authorise Mr Tsipras to negotiate with Greece’s lenders. Another 15 indicated over the weekend they would not vote for individual austerity measures.

    The strongest internal criticism came from energy minister Panagiotis Lafazanis, leader of the so-called Left Platform within Syriza, who said the deal was “humiliating” and should be rejected. “We will fight it,” he said.

    There was speculation in Athens that Mr Tsipras could sack Mr Lafazanis, along with deputy labour minister Dimitris Stratoulis, a former trade unionist and a fierce opponent of pension cuts.

  • 12:13

    So what happens next in Greece?

    As the scale of the tough terms accepted by Greek prime minister Tsipras emerged this morning, senior party figures were predicting the prime minister would struggle to hold his government together, reports Ruadhán Mac Cormaic.

    Under Syriza party rules, deputies are supposed to resign their seats if they publicly disagree with government policy although there is nothing to stop them refusing to stand down and holding on to their seats as independents.

    The government has 162 seats in the 300-seat parliament, and Mr Tsipras can depend on support from the opposition benches to pass the austerity measures this week. Three opposition parties - New Democracy, Pasok and Potami - have indicated they will support the government.

    One option for Mr Tsipras is to form a government of national unity, but major questions remain over how stable such an arrangement would prove, given the ideological differences between Syriza and the conservative New Democracy and left-leaning Pasok.

    Most analysts in Athens believe the deal agreed in Brussels bring a Greek election closer. Opinion polls suggest Syriza remains by far the strongest party and the most likely winner.

     

  • 12:16
  • 12:25

    Greece’s former finance minister Yanis Varoufakis has spoken to the New Statesman about his 5-month battle to save Greece.

    Mr Varoufakis said the creditors' proposals agreed on by the Athens government on Friday were “absolutely impossible, totally non-viable and toxic …[they were] the kind of proposals you present to another side when you don’t want an agreement.”

    “This country must stop extending and pretending, we must stop taking on new loans pretending that we’ve solved the problem, when we haven’t; when we have made our debt even less sustainable on condition of further austerity that even further shrinks the economy; and shifts the burden further onto the have-nots, creating a humanitarian crisis.”

    Mr Varoufakis said countries within the euro groups had always been united in their refusal to renegotiate.

    “There were people who were sympathetic at a personal level, behind closed doors, especially from the IMF,” he said, adding that he was referring to Christine Lagarde, the IMF director.

    “But then inside the euro group [there were] a few kind words and that was it: back behind the parapet of the official version. … Very powerful figures look at you in the eye and say ‘You’re right in what you’re saying, but we’re going to crunch you anyway’.”

  • 12:29
  • 12:30

    Asked why he was taken off Greece’s negotiating team shortly after Syriza took office, Greece's former finance minister Yanis Varoufakis told the New Statesman he tried talking economics in the euro group, “which nobody does”.

    “It’s not that it didn’t go down well – there was point blank refusal to engage in economic arguments. Point blank. You put forward an argument that you’ve really worked on, to make sure it’s logically coherent, and you’re just faced with blank stares. It is as if you haven’t spoken. What you say is independent of what they say. You might as well have sung the Swedish national anthem – you’d have got the same reply.”

  • 12:54
  • 13:02

    It’s time for a recap. What has been agreed and what comes next?

    Has an agreement on a new bailout package for Greece been reached?

    Technically, no. Euro zone leaders agreed this morning to consider backing a third bailout, if certain conditions are met. The agreement reached this morning also gives political cover to the European Central Bank to keep propping up the Greek banks with emergency funding if it so wishes.

    What conditions now have to be met for a third bailout to be sanctioned?

    Firstly, the Greek Parliament must pass a number of measures by Wednesday, including the streamlining of the VAT system and broadening of the tax base. Then the eurogroup will probably meet again before the end of the week to assess if the measures have been implemented, and to mandate the EU institutions to start negotiating a new Memorandum of Understanding between Greece and its creditors.

    If all goes to plan is Greece out of the woods?

    No, there are other factors at play. In parallel to talks about a third bailout, separate decisions will have to be taken about Greece’s short-term financing needs and the dire situations of the banks which are now estimated to need €25 billion in capital.

    Is there anything new in the proposal?

    From the Greek perspective very little has changed in terms of the reform measures being demanded by creditors. One new aspect of the latest proposal is a €50 billion fund, which will hold valuable Greek assets that will be either sold off or managed to generate up to €50 billion. €25 billion of this will be used for recapitalising banks, with half of the remaining 50 per cent used for debt reduction, and the remaining funds used for investment in Greece.

  • 13:08
  • 13:13
  • 13:21

    As EU leaders rest up after more than 17 hours of talks over a resolution to the Greek debt crisis, Twitter users have been busy flooding the social media waves with the latest viral trend #ThisIsACoup.

    #ThisIsACoup was the second top trending hashtag on Twitter worldwide - and top in Germany and Greece - as euro zone leaders argued through the night to convince Greek prime minister Alexis Tsipras to take the deal or face bankruptcy and his country’s expulsion from the EU’s common currency area.

    The hashtag appeared to originate on Sunday evening from Sandro Maccarrone, who describes himself as a physics teacher from Barcelona. He tweeted: “The Eurogroup proposal is a covert coup d’etat against the Greek people. #ThisIsACoup."

    Within hours it had been used nearly 200,000 times.

    “I can’t support a Europe that acts as a thuggy bailiff against Greece #Thisisacoup,” tweeted Suzanne Moore, a columnist for the Guardian newspaper.

    Barbara Lochbihler, a member of the European Parliament for Germany’s Greens party, tweeted: "They talk about trust. Only to draft a proposal that is pure humiliation. Brilliant idea. #ThisIsACoup."

  • 13:26
  • 13:29
  • 13:47

    The Grexit nearly became a reality in the early hours of Monday morning according to the Financial Times.

    The paper has reported that at about 6am on Monday morning Alexis Tsipras and Angela Merkel decided after 14 hours of talks that they had reached a dead end.

    “With no room for compromise, neither saw any reason to carry on,” reports the Financial Times. “Grexit was the only realistic option.”

    It writes that as the two leaders headed towards the door, Donald Tusk, president of the European Council, made the move to prevent “the fatigue and frustration from triggering a historic rupture for the euro zone”.

    “Sorry, but there is no way you are leaving this room,” the former Polish prime minister reportedly said.

  • 13:51
  • 13:55

    Out of the grey, into the black and white

    Alexander Stubb, finance minister of Finland, which has been one of Greece’s fiercest opponents, said he was “hopeful” all parliaments would back the deal, reports Reuters.

    He told BBC Radio 4’s World At One programme: “I’m fairly happy with the deal.

    “There’s absolutely no space for any wriggle room after this. There’s one thing that is still hanging up in the air a little bit which we need to keep in mind and that is bridge financing. That is something we will be dealing with, European finance ministers, this evening.

    “But, all in all, I think we are out of the grey zone. This was a very black and white decision.”

  • 14:07
  • 14:13

    The decision today by the ECB not to increase the amount of emergency liquidity for the Greek banks will keep up the pressure on prime minister Tsipras and Greece’s politicians to deliver the planned legislative changes by Wednesday, writes Cliff Taylor.

    The banks are running out of cash and need an increase in emergency liquidity to stay alive, at some stage in the near future.
    Sources reported by wire services say they can survive for a couple more days with the existing €60 limit on withdrawals in place. Will the ECB then release fresh cash later this week?

    One conundrum is that the deal reached at the weekend acknowledges that the banking system needs more capital, and the ECB is not meant to be funding insolvent banks.

    Of course needing more capital does not imply immediate insolvency, but this is still tricky. It is clear that bank mergers and restructuring is on the way. Presumably somebody has a plan for how the Greek banks will be funded in the meantime....

  • 14:26

    Euro zone finance ministers will attend a meeting chaired by eurogroup president Jeroen Dijsselbloem in Brussels at 3pm (Irish time) this afternoon. They are expected to focus on “bridge financing” to address Greece’s immediate financial needs.

    Later today the European Central Bank is expected to decide whether to increase emergency liquidity assistance to Greek banks which have been closed for two weeks.

  • 14:34

    How will this morning’s Euro summit agreement play out with the Irish political parties, groupings and politicians who have aligned themselves to Syriza?

    Harry McGee reports the agreement represents a big political set-back for Sinn Féin.


    The party has not so much aligned as chained itself to Syriza in the past year. Alexis Tsipras was feted by the party in Dublin. Pictures of Tsipras and party leader Gerry Adams together in Dublin were widely distributed.

    Other left-wing parties don’t believe Sinn Féin is a true party of the left. That said it is definitely left-leaning and has led the anti-austerity charge in Ireland.

    On the spectrum, Sinn Féin is somewhere between socialist and social democrat.

    So where does it leave Sinn Féin? Well, the party is going to take a hit.
    If the party continues to back Syriza it will be acknowledging - to all intents and purposes - that it in power could have done little to alter the course of history over the past few years.

    If it backs away from Syriza it will be accused of back-peddling and of being Tadhg an Dá Thaobh (Tadhg of the two sides).

  • 14:47
  • 14:52
    Eurogroup President Jeroen Dijsselbloem rings the bell at the start of a euro zone finance ministers meeting in Brussels on Monday afternoon. Euro zone leaders made Greece surrender much of its sovereignty to outside supervision on Monday in return for agreeing to talks on an €86 billion bailout to keep the near-bankrupt country in the single currency. Photograph: Francois Lenoir/Reuters
    Eurogroup President Jeroen Dijsselbloem rings the bell at the start of a euro zone finance ministers meeting in Brussels on Monday afternoon. Euro zone leaders made Greece surrender much of its sovereignty to outside supervision on Monday in return for agreeing to talks on an €86 billion bailout to keep the near-bankrupt country in the single currency. Photograph: Francois Lenoir/Reuters
  • 15:04

    Greek prime minister Alexis Tsipras, who has arrived back in Athens, Greece, has posted online his statement following the conclusion of the euro zone summit.

    He said:
    “We have been fighting hard for six months now, and we fought until the end to achieve the best possible outcome, an agreement that will enable the country to get back on its feet, and for the Greek people to be able to continue to fight.

    “We faced tough decisions, tough dilemmas. We assumed responsibility for the decision in order to prevent the most extreme objectives from being implemented—those pushed for by the most extreme conservative forces in the European Union.

    “The agreement calls for tough measures. However, we prevented the transfer of public property abroad, we prevented the financial asphyxiation and the collapse of the financial system—this was planned to the last detail – having recently been designed to perfection, and in the process of being implemented.

    “Finally, in this tough battle, we managed to gain the restructuring of the debt and a financing process for the medium-term...

    “I believe that a large majority of the Greek people will support the effort to return to growth; they acknowledge that we fought for a just cause, we fought until the end, we have been negotiating through the night, and no matter what the burdens will be, they will be allocated – we guarantee this – with social justice.

    "And it will not be the case that those who have shouldered the burden during the last years will be stuck footing the bill once more. This time, those who avoided paying—many of whom were protected by the previous governments–will pay now, they, too, will shoulder the burden.

    “Finally, I want to make this commitment: Now, we need to fight just as hard as we fought to achieve the best outcome abroad-in Europe, to rid vested interests in the country. Greece needs radical reforms in favor of social forces, and against the oligarchy that have led to the country’s current state.


    "And this commitment to this new effort begins tomorrow.”

  • 15:12
    <p>Greek Prime Minister Alexis Tsipras arrives at his office in Athens on Monday afternoon just after flying in from Brussels. Euro zone leaders have reached an agreement on plans for a bailout to prevent debt-stricken Greece from crashing out of the euro. Photograph: Louisa Gouliamaki/AFP/Getty Images</p>
<p>  </p>

    Greek Prime Minister Alexis Tsipras arrives at his office in Athens on Monday afternoon just after flying in from Brussels. Euro zone leaders have reached an agreement on plans for a bailout to prevent debt-stricken Greece from crashing out of the euro. Photograph: Louisa Gouliamaki/AFP/Getty Images

     

  • 15:14
  • 15:15
  • 15:24

    Euro zone finance ministers have begun their third meeting in three days, after an agreement was reached this morning on the basis for negotiations with Greece, reports Suzanne Lynch from Brussels.

    However, Finnish finance minister Alex Stubb has stressed that a mandate to begin negotiations with Greece on a new bailout had not yet been reached.

    “There seems to be a lot of people who have jumped the gun here and thought that the beginning of the negotiations is automatic. No, it is absolutely conditional on the decision by the Greek government and the Greek parliament,” he said on his way into the eurogroup meeting.

    Finance ministers are expected to discuss possible bridge financing for Greece to tackle its immediate financial needs, including imminent repayments to the ECB and its outstanding IMF repayments.

    The communiqué agreed by leaders early this morning, estimates that Greece needs between €82 billion and €86 billion before 2018, but also noted the “urgent financing needs” of Greece.

    Among the possibilities to bridge Greece’s immediate financing gap, is that money from the EFSM fund would be used, though that would need the backing of all 28 EU members including Britain.

  • 15:29

    The Greek government has been given a deadline of Wednesday to implement reform measures, including contentious VAT and pension reforms, Suzanne Lynch reports from Brussels.

    The German Bundestag could be recalled to vote on the proposal by Friday.

    Speaking this morning, German chancellor Angela Merkel said she could recommend “with full confidence” that the Bundestag authorize the opening of loan negotiations with Athens once the Greek parliament has approved the entire program and passed the first laws

  • 15:33
  • 15:38

    The euro summit meeting has come to an agreement following last night/this morning’s talks, so what do we need to keep an eye on in the week ahead?


    Monday, July 13th: At 4 pm (3pm Irish time) eurozone finance ministers meet in Brussels for a eurogroup meeting. Chaired by eurogroup president Jeroen Dijsselbloem, it is expected to focus on the question of “bridge financing” for Greece to try to address the country’s immediate financing needs.


    Monday, July 13th: (afternoon/evening): the European Central Bank is expected to decide whether to increase the amount of emergency liquidity assistance (ELA) it is providing to Greek banks which have been closed for two weeks.


    Tuesday, July 14th: finance ministers of all 28 EU member states gather in Brussels for a scheduled meeting. Any involvement on non-euro zone countries, such as Britain, in bridge financing for Greece could be discussed at this meeting.


    Wednesday, July 15th: the deadline by which the Greek parliament must pass a range of reform measures, including streamlining of VAT and pension reforms .


    Thursday /Friday, July 16th/17th: possibility of a eurogroup meeting of finance ministers or euro zone summit to consider Greek parliament’s implantation of measures and whether to sign up to negotiations on a new memorandum of understanding between Greece and the troika for a third bailout


    National parliaments, including the Bundestag, may also be recalled towards the end of the week to vote on whether to endorse the beginning of negotiations on a third bailout.


    Monday July 20th: Greece due to repay €3.5 billion to ECB.

  • 15:42

    Forget about a busy week ahead, it looks like we've got a jam-packed summer to come.  


  • 15:57
    That's all from me, Sorcha Pollak, for today. Ciara O'Brien - @ciaraobrien - is picking up the live-blog reins, bringing you all the latest from Brussels and Athens over the next few hours.  
  • 16:09
    Thanks Sorcha.

    There's a few things happening already. Standard and Poor's is saying it could upgrade Greece's rock bottom credit rating "pretty quickly" if the bailout plan holds. According to Moritz Kraemer, an analyst with the ratings agency, the deal reduces the immediate risk of Greece leaving the euro, although S&P still has that outcome as its longer-term base case. S&P currently rates Greece as CCC-.
  • 16:10
    The IMF is ready to work with Greece, according to a spokesman, and also with Europe to help move things forward.
  • 16:13
    Reuters is quoting the spokesman as saying the IMF board has been briefed by Christine Lagarde on the outcome of the talks over Greece's debt.
  • 16:43
    Meanwhile, Tsipras is back in Greece, meeting with his coalition partners and aides about the bailout. The general feeling is that it will cause mutiny in the ranks; Tspiras has been forced to abandon the anti-austerity stance and instead is seeking his partners' approval for tax increases, spending cuts and pension savings.
  • 16:44
    Tsipras's loss is the stock market's gain: European equities have extended their biggest rally since 2011 following the agreement, while US stocks are also up.
  • 17:08
    Meanwhile, Dijsselbloem has been re-elected as president of the euro group.

  • 17:10
  • 17:51

    Speaking of coups, Greece’s junior coalition party leader is claiming that Tsipras was facing a coup by Germany in Brussels, and says the deal is outside what was lawmakers signed up to. He’s bring pretty clear about it: they cannot agree to the new deal.

     

    They'll stay in the coalition though.

  • 17:58
  • 17:59
  • 18:00
    That's Slovakia's finance minister and deputy prime minister's opinion.
  • 18:02



  • 18:51
    We're going to leave it there for the night. You can follow the story and all the latest updates here