Greece creditors offer 5-month bailout extension

Greece's international creditors on Friday offered Athens a five-month, 12-billion-euro ($13.4-billion) extension of its bailout programme but said it must seal a deal this weekend to avoid an IMF default next week.

Angela Merkel and Francois Hollande discussed financing plans with leftist Greek Prime Minister Alexis Tsipras on the eve of a "decisive" meeting of <g data-gr-id="27">eurozone</g> finance ministers aimed at finding a deal to end the crisis.

The offer came after intensive talks in Brussels this week to end the standoff between Tsipras's anti-austerity government, which has balked at further reforms-for-cash after five years of bailout-imposed economic hardship. Creditors are ready to quickly disburse 1.8 billion euros in financial aid to help Athens meet a 1.5 billion euro IMF debt repayment on June 30 as long as the Greek parliament approves disputed reforms, according to proposals seen by AFP.

German finance minister Wolfgang Schaeuble said the chances for a bailout deal stand at about "50-50", with European markets fluctuating as Greece's <g data-gr-id="30">fate</g> remains in suspense. German Chancellor Merkel and French President Hollande told Tsipras in brief talks on the sidelines of an EU summit that another emergency Eurogroup meeting of finance ministers on Saturday was now critical for an agreement. "They reminded him that this meeting was crucial and decisive and that it was vital now to work towards a deal on a package that includes reforms, investment and financing," a source said.

Tsipras told Merkel and Hollande he could not understand their "harsh" stance. "Alexis Tsipras informed the two leaders on the Greek proposal and stressed that the Greek side does not understand the persistence of institutions in such harsh measures," a Greek governmental source told AFP. Eurozone finance minister talks on Thursday that had been supposed to produce a deal that EU leaders could rubber stamp at their summit next door broke down with no agreement. Syriza party leader Tsipras was elected in January on an anti-austerity platform and has resisted ever since the creditors' demands for pensions cuts and VAT reforms in return for unlocking bailout funds

An extension to Greece's massive 240 billion-euro bailout to the end of November would be the third since December and allow more time for heavily indebted Athens to negotiate future financing from its European partners.Jeroen Dijsselbloem, the head of the Eurogroup of finance ministers, said a deal had to be clinched tomorrow or there will not be enough time for it to get parliamentary approval. "Tomorrow it really has to happen, for the simple reason that it has to go through parliament, first the Greek then of several member states," the Dutch finance minister told journalists in The Hague.

Under the creditor proposals, the immediate 1.8 billion euro disbursement-profits from Greek bonds held by the European Central Bank would be paid "as soon as the Greek parliament has approved <g data-gr-id="25">with </g>a resolution the agreement with the (creditor) institutions and adopted a first set of legislative actions", the plans said.