Eurozone leaders hopeful of deal

German Chancellor Angela Merkel said Greece's latest offer constituted "some progress". But she said more work was needed and "time is short".

 

Greece must repay €1.6bn (£1.1bn) to the International Monetary Fund (IMF) by the end of the month.

If it fails to do so, it risks crashing out of the euro and possibly the EU.

Although no deal has been struck, key obstacles appear to have been cleared, the BBC's Damian Grammaticas reports from Brussels.

The deal being formed is believed to include:

• New taxes on businesses and the wealthy
• Selective increases in VAT
• Savings in pensions linked to curbing early retirement and increasing pension contributions
• No further reductions in pensions or public-sector wages - "red lines" for Greece's Syriza government

The move was received with cautious optimism by leaders of 18 other eurozone nations gathered for an emergency summit in Brussels.

There is a script which seemingly all eurozone leaders are urged to learn, which is that if the currency union is in the grips of crisis, no solution can or should be found till markets and economy are on the verge of a heart attack.

With almost no time left before a de facto default - and, more frighteningly perhaps, with a Greek banking system on the brink of total collapse because savers had lost all confidence that a rescue for their state could be found - Mr Tsipras has come up with a plan that his fellow eurozone leaders see, at last, as the basis for a deal.

So subject to technical talks, an actual deal to release life-saving additional loans for Greece may be reached at the end of the week.