Tsipras 'wants to avoid meltdown'
Greek prime minister Alexis Tsipras wants to strike a deal with European creditors at today's summit to avoid a meltdown of the country's teetering banks, a Greek government official says.
The official, speaking anonymously, said European Central Bank president Mario Draghi has warned eurozone finance ministers that Greek banks are at risk and that the need for a deal is pressing.
Without the prospect of a deal, the ECB will not be able to increase emergency liquidity assistance to Greek banks. It has frozen its help over the past couple of weeks as the banks have stayed closed.
The official also says that some of the creditor proposals, such as a requirement for Greece to deposit 50 billion euros (£32 billion) worth of state-owned assets into a special fund for subsequent sell-off, appear intended to "humiliate" the Greek government.
The fear is that by Monday the banks may have exhausted all their cash reserves, which could spark financial chaos.
Tsipras was facing intense pressure today to back an onerous package of austerity measures demanded by European creditors in return for a financial rescue that would prevent the collapse of the banks and its potential exit from the euro.
The leaders, who have been in closed-door talks today, have vowed to keep talking until something concrete can emerge. They were presented with a set of proposals from the eurozone's top official, Jeroen Dijsselbloem, who said the sides have "come a long way" after two days of talks among finance ministers.
The final effort on "some big issues," would be left to the leaders, Dijsselbloem said.
Greece has asked Europe's bailout fund for a three-year 53.5 billion-euro (£38 billion) financial package but many officials in Brussels say the figure will have to be much higher and insist on tough Greek austerity measures. This would be Greece's third bailout in five years.
The broad outlines of a deal appeared to consist of a long series of commitments from Tsipras to push through much of a drastic austerity program within days, while the 18 other eurozone leaders would commit to start talks on a new bailout programme.
In a four-page draft proposal put to eurozone leaders and obtained by The Associated Press, language up for discussion spoke of a potential "time-out from the euro area" for Greece if no agreement could be found.
It highlighted the increasing frustration with Greece during five months of fruitless talks. Today, doubts on the Greek government's commitment to implement tough measures continued.
"The most important currency has been lost: that is trust and reliability," said German chancellor Angela Merkel, reflecting on five months of tortuous negotiations with Athens.
In the draft document, Greece committed itself to pushing a first set of measures through parliament by Wednesday. Despite the stinging conditions on pension, market and privatisation reforms, Tsipras insisted his government was ready to clinch a deal.
"We owe that to the peoples of Europe who want Europe united and not divided," he said. "We can reach an agreement tonight if all parties want it."
Merkel, however, insisted that Germany would not sway from its stance that Greece needs to do much more to get any help just to save its position in the 19-nation eurozone.
"There will not be an agreement at all costs," she said, going into today's summit meeting. "Nerves are tense."
Highlighting the differences within the creditors' camp, French president Francois Hollande insisted it was vital to keep Greece in the currency club and avoid a so-called "Grexit".
Finnish finance minister Alexander Stubb, one of Greece's most outspoken critics, said a package of proposals sent to the leaders involved three key elements, including the Greek parliament's passing of a series of unspecified laws by Wednesday.
If these conditions are met, then talks with Europe's bailout fund can proceed, Stubb said.
"We have surely taken a good leap forward," Stubb said.