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1st LD Writethru: Eurozone FinMins head to Greek bailout deal amid concerns on reform implementation

Xinhua, July 11, 2015 Adjust font size:

After months tough negotiations, the finance ministers from the eurozone countries will decide whether to formally open negotiations with Greece on a new 53.2 billion euros (about 59 billion U.S. dollars) bailout proposal Saturday afternoon to avert Greece bankruptcy and likely Grexit.

The crucial meeting was widely seen as a "decisive moment" for Greece's fate: either a bailout deal or Greece's exit from the European common currency zone.

The financially-troubled country submitted a detailed package of reform proposals to the Eurogroup on Thursday night, pledging to carry out a new package of comprehensive reform measures promptly.

The creditors had given a positive assessment which makes it possible that an agreement to aid Greece will be reached in the afternoon meeting of the Eurogroup.

"The institutions believe new Greek proposal can be basis for negotiations," said Pierre Moscovici, European commissioner in charge of Economic and Financial Affairs, Taxation and Customs, adding that the Greek government had made a significant gesture in the new proposals.

The commissioner stressed that the implementation of the reform proposals which were first rejected by the Greek government would be a key point in the negotiations.

Several eurozone finance ministers have arrived at the crucial Eurogroup meeting with serious doubts over implementation of the Greek proposals.

"We need guarantees for the implementation of the Greek reforms," Hans Jorg Schelling, Austria's Finance Minister, said before stepping into the meeting.

If the Eurogroup agrees to open negotiations, Sunday's planned emergency summit of 28 European Union leaders may be cancelled.

However, if the finance ministers couldn't reach an agreement on renegotiation, Athens has a last chance trying to persuade leaders on Sunday to open negotiations.

Athens' proposals for a new set of tax hikes, pension cuts and economic reforms in exchange for a 53.2-billion-euro third bailout program through the ESM has been approved by the Greek parliament earlier on Saturday.

Without a debt deal in the coming hours, Greece faces a financial collapse and a Grexit: Greek banks have been closed for the past two weeks and are running out of cash while the country's economy is suffering from capital controls.

Besides, Greece has been in arrears to the IMF since July 1 and faces a 3.5-billion-euro debt repayment to the ECB on July 20. (1 euro = 1.11 U.S. dollars) Endit