The Greek government is reportedly planning to request a new two-year bailout deal from the eurozone.
It comes just hours ahead of a today’s midnight deadline to repay €1.6bn to the International Monetary Fund.
Reports of the move to call for aid from the European Stability Mechanism emerged as Greek leaders held talks over the European Commission’s latest proposal for Greek economic reforms.
If Athens accepts the EC deal, it will free up cash to repay the €1.6bn.
Prime minister Alexis Tsipras’ office said Greece remains at the negotiating table, and that the government has proposed a
two-year deal with Europe’s bailout fund.
Details over the offer with the European Stability Mechanism, which provides financial assistance to assure the joint currency’s financial stability, were sketchy.
However, Mr Tsipras’s office said the deal would “fully cover its (Greece’s) fiscal needs with the simultaneous restructuring of debt” and that the government “until the end will seek a viable solution within the euro.”
EU officials said Greece would lose access to more than €16bn in financial support if its bailout program expires tonight.
The officials said three sources of money would disappear in the event of no agreement to extend the bailout.
These include €1.8bn from the EU’s financial stability fund, €10.9bn from a Greek bank rescue fund, and a further €3.4bn in central bank profits.
Greece can apply for some other form of assistance, but this could take weeks to organise.
In that case, an assessment would first have to be made on whether Greece is eligible, what kind of terms the new package would function under and the kinds of reforms that Athens would undertake in return.