Photo: Greek finance minister Euclid Tsakalotos listens to IMF managing director Christine Lagarde (C) during an Eurozone finance ministers meeting in Brussels. (Reuters: Francois Lenoir)
Talks between Eurozone finance ministers on Greece's last-ditch bailout request have been "quite difficult" given the crucial need to rebuild trust with Athens, Euro group chief Jeroen Dijsselbloem says.
The finance ministers from the 19-country euro area have gathered in Brussels to review Greece's proposals for market-oriented reforms in exchange for its third bailout since 2010, needed to prevent it from crashing out of the European single currency.
The first day of the talks ended without agreement, but some progress had been made in what Mr Dijsselbloem described as difficult negotiations.
The ministers will meet again before Sunday's summit at which all 28 European Union leaders will decide whether to accept Greece's proposal.
"We are not there yet. There is a major issue of trust — can the Greek government be trusted to do what they are promising in coming weeks, months and years?" Mr Dijsselbloem said.
"They will have to show a major commitment to rebuild that trust," the chief and Dutch finance minister said, adding it would be "quite a difficult meeting".
The meeting comes ahead of the make-or-break summit of European Union leaders.
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Minister after minister insisted on the need to rebuild trust with Athens after six months of torturous debt deal negotiations and a sudden referendum in which Greeks overwhelmingly rejected creditors' bailout terms.
Hardline German finance minister Wolfgang Schaeuble led a chorus of scepticism about Greek prime minister Alexis Tsipras' new reform plan worth more than 80 billion euros ($119 million).
"In the last months hope has been destroyed in an incredible way, even up to just a few hours ago. Definitely we cannot trust promises," he said.
French finance minister Michel Sapin, whose country has been more supportive of Greece than some other Eurozone partners, also said the talks would be difficult.
"Confidence is a crucial element of an agreement," Mr Sapin said.
"If we want a lasting agreement, the Greeks must provide responses on when they will decide ... and at what pace they will do it," he said, suggesting the international creditors would seek a precise timetable for carrying out reforms.
Concerns over Greece's future
On Saturday, the Greek parliament voted overwhelmingly in favour of authorising the left-wing government of Mr Tsipras to negotiate with international creditors on the basis of a reform program unveiled this week.
In a late-night session of parliament, Mr Tsipras and finance minister Euclid Tsakalotos rallied support for the plan.
A total of 251 voted "Yes", 32 voted "No" and eight "Present", while nine deputies were absent.
In a statement issued after the vote in parliament, won with the help of pro-European opposition parties, Mr Tsipras said he had a "strong mandate to complete the negotiations to reach an economically viable and socially fair agreement".
When I go to the supermarket they don't have many foods, even milk for the baby, the pharmacies don't have any more [medicine].
Despite roundly voting 'No' last Sunday to accepting tough austerity terms for a bailout that expired June 30, Greeks are alarmed at capital controls that have closed banks and rationed cash at ATMs for nearly two weeks.
Standing in line at a cash machine in Athens, Vassilis Papoutsoglou, 52, said: "We still don't know what will happen tomorrow. Can we expect something better, or is it Armageddon?"
"When I go to the supermarket they don't have many foods, even milk for the baby, the pharmacies don't have any more [medicine]," added Marilena Mouzaki, 35, who was walking with her 11-month-old son.
The Greek government hoped the vote would give it an emphatic mandate to continue the talks with the creditors.
But it also revealed the depth of opposition to fresh austerity.
Three senior government figures were among 10 deputies who abstained or voted against and several others from the ruling leftist Syriza party stayed away, prompting commentators to predict a government shake-up.
Mr Tsipras told parliament it was a "national duty to keep our people alive ... we will succeed not only in staying in Europe but in living as equal peers with dignity and pride".
The deal was "marginally better" than proposals put forward by the creditors last month that did not ease Greece's 320-billion-euro mountain of debt, Mr Tsipras said.
Optimism a rarity
Despite the gloom, there were some hopeful voices in Brussels.
International Monetary Fund (IMF) chief Christine Lagarde — who has echoed calls by Athens and the United States for part of Greece's debt to be eliminated — was more positive, saying she hoped for "a lot of progress".
Euclid Tsakalotos, the mild-tempered professor appointed as Greece's new finance minister, is a clear change in style from his combative predecessor Yanis Varoufakis.
Greece became the first developed economy to default on a huge payment to the IMF on June 30.
EU economic affairs commissioner Pierre Moscovici said that "rapidly" putting reforms in action was "key to getting a program, to be able to tackle the debt" .
EU sources who asked not to be named put the probability of a deal at no more than 50-50.
If eventually approved, Greece could receive between 74 billion and 82 billion euros from its EU-IMF creditors, including 16 billion euros from the IMF that is part of an old program due to expire next March, sources close to the negotiations said.
EU president Donald Tusk said the 28-nation European summit he will host in Brussels on Sunday is a "last chance" for Greece to seal a deal and avoid a disastrous "Grexit".
And even if the leaders agree a deal, at least eight parliaments will have to weigh in, with Germany's Bundestag having to vote twice.
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