Greece's Tsipras in last-ditch talks with European leaders

[BRUSSELS] Greek Prime Minister Alexis Tsipras held last-ditch talks with European leaders in Brussels on Wednesday to seek a breakthrough that could stop Athens going bankrupt by the end of the month.

Mr Tsipras met European Commission chief Jean-Claude Juncker on the sidelines of an EU-Latin American summit and was later due to hold crunch three-way talks with German Chancellor Angela Merkel and French President Francois Hollande.

Debt-stricken Greece meanwhile signalled for the first time that it was ready to discuss key reform concessions and an extension until March 2016 of its current EU-IMF bailout, which expires on June 30.

"The goal is to keep Greece in the eurozone. I always approach these things with the attitude, if there is a will there is a way," Dr Merkel, Europe's most powerful leader, told reporters as she arrived for the summit in Brussels.

Time is desperately short for a deal to end a five-month standoff between Athens and its creditors that will unlock the last 7.2 billion euro (S$11 billion) tranche of Greece's bailout and save it from default and a possible exit from the euro.

Any deal agreed in coming days would also have to be approved by eurozone finance ministers in Luxembourg next week, before being voted on by several national parliaments.

But the positive developments were a major turnaround after days of tensions in which Mr Tsipras and key power-broker Juncker traded barbs over their clashing proposals for reforms to Greece's finances.

JUNCKER BEAR-HUG

Mr Juncker bear-hugged Tsipras and kissed the radical leftist leader for the cameras when he arrived for the summit, as usual wearing no tie.

"The two leaders exchanged views, in a detailed manner and in a constructive climate, and agreed to meet tomorrow," the Greek government said after the talks.

Mr Tsipras, leader of the radical Syriza party that won elections in January, has vowed to end the "humanitarian crisis" caused by five years of austerity imposed under two international bailouts since 2010.

Greece submitted a new reform plan on Tuesday in response to a rival set of proposals that Mr Juncker put forward over a dinner in Brussels a week ago - which the Greek leader later derided as "absurd".

Bad blood continued hours before the summit when the European Commission flatly rejected the latest proposals from Athens.

In a bid to break the deadlock, Mr Tsipras asked for talks with Dr Merkel and Mr Hollande on the sidelines of the summit of EU and Latin American leaders later Wednesday.

The three-way meeting was in doubt throughout the day, but German and French officials finally confirmed to AFP that it would take place after the official summit dinner.

Mr Hollande urged the EU and Greece to "work, go fast and conclude."

GREECE READY FOR CONCESSIONS?

The more positive mood was echoed by Pierre Moscovici, the EU's economic affairs commissioner, who told AFP that he believes "more than ever that a deal is possible if the political will is shared by all".

He warned however that the "next few days would be decisive for Greece." Greece meanwhile signalled it was "prepared to discuss a solution" to the row over its budgetary targets, a key sticking point in the talks.

"There is no deal for a one percent surplus, but the question is on the table," the source said, referring to a budget target for 2015 that Athens has so far dismissed on the basis that it would require more austerity to achieve.

In a sign of its perilous situation, last week Greece said it would bundle all of its payments due to the IMF in June, making a total of 1.6 billion euros due at the end of the month, becoming the first country since Zambia in the 1980s to choose that option.

Greece must still find a longer-term solution and it said it was prepared to extend its current bailout programme by nine months, which would give it longer to work with its creditors.

Mr Tsipras is under pressure from Syriza hardliners to keep his promise to refuse more austerity and seek a restructuring of Greece's debt, which amounts to around 170 per cent of the country's annual GDP.

AFP