Athens, Greece (BBN)-Greek Prime Minister Alexis Tsipras is expected to present new proposals at a Eurozone emergency summit on his country’s growing debt crisis.
The plan is said to include a demand for Greece’s debt to be cut by up to 30 per cent, after voters rejected the terms of an international bailout on Sunday, reports BBC.
Athens has been urged to make “serious” proposals as Greece faces the risk of default on its $331bn (£213bn) debt.
Greece’s banks are to stay closed on Tuesday and Wednesday.
Meanwhile, global stock markets proved resilient on Tuesday, despite Greece’s rejection of the bailout terms.
NERVOUS AND WORRIED
Eurozone finance ministers will begin their meeting in Brussels later on Tuesday before a full summit of eurozone leaders.
Mr Tsipras may be prepared to accept many of the demands made by Greece’s creditors, the BBC’s Chris Morris in Athens reports.
But – emboldened by his resounding win in the referendum – Tsipras also wants changes and substantial debt relief, our correspondent says.
Central to any negotiations will be new Greek Finance Minister Euclid Tsakalotos, who replaced outspoken Yanis Varoufakis on Monday.
Tsakalotos has admitted he is nervous and worried about the crisis, but said Greece deserved a better deal.
However, Germany earlier warned against any unconditional write-off of Greece’s debt, saying it would destroy the single currency.
“I really hope that the Greek government – if it wants to enter negotiations again – will accept that the other 18 member states of the euro can’t just go along with an unconditional haircut [debt write-off],” said German Economy Minister Sigmar Gabriel.
WHAT HAPPENS NEXT?
Meanwhile, the European Central Bank (ECB) said it would maintain existing levels of emergency cash support for Greek banks, which are running out of funds and on the verge of collapse.
However, it told the banks to lodge more collateral with the Bank of Greece, reducing the amount of spare cash the banks have.
Greece’s Economy Minister, Georgios Stathakis, had earlier told the BBC that the ECB had to keep Greek banks alive for seven to 10 days so that negotiations could take place.
Last week, Greece ordered banks to close after the ECB froze its financial lifeline following the breakdown of bailout talks in Brussels.
Capital controls have been imposed, with people unable to withdraw more than €60 a day from cash points.
On Monday, French President Francois Hollande and German Chancellor Angela Merkel said the door was still open for debt negotiations.
“It is now up to the government of Alexis Tsipras to make serious, credible proposals so that this willingness to stay in the eurozone can translate into a lasting programme,” Mr Hollande said.
Mrs Merkel added that Tsipras should offer “precise suggestions… for a medium-term programme that will lead Greece to prosperity and growth again.”
Greece’s last bailout expired last Tuesday and Greece missed a €1.6bn payment to the IMF.
The European Commission – one of the “troika” of creditors along with the IMF and the ECB – wanted Athens to raise taxes and slash welfare spending to meet its debt obligations.
Greece’s Syriza-led left-wing government, which was elected in January on an anti-austerity platform, said creditors had tried to use fear to put pressure on Greeks.