German banker: need more than Greek debt writeoffs (AP)

ATHENS — Marathon overnight negotiations by the leaders of the 19 euro zone states over a third bailout for Greece in five years finally ended Monday with an announcement that harsh new conditions are to be imposed on Athens in return for it to be allowed to keep the euro as its currency and avoid total economic collapse.

ATHENS — What the negotiations between Greece and the European Union over the country’s future in the eurozone have revealed is that the current Greek government — and the ones that preceded it — are not to be trusted, even to run a lemonade stand. So a Canadian wrote over the weekend in an email that I was copied on. But the fault is not entirely Greece’s.

BRUSSELS: Greece, which may default on an International Monetary Fund debt repayment due on Tuesday after talks with creditors broke down, owes its official lenders 242.8 billion euros ($271 billion), according to a Reuters calculation based on official data, with Germany by far the largest creditor. That figure includes loans made under two bailouts from European governments and the IMF since 2010 -- worth a nominal 220 billion euros so far, of which some has been repaid -- as well as Greek government bonds held by the European Central Bank and national central banks in the euro zone.

Greek leaders have fought fiercely in recent months with politicians from other European countries over relief on Greece's vast debt load. Yet the power to decide the fate of Greece lies not just in the hands of these national governments, but also with unelected officials at two powerful institutions: the European Central Bank and the International Monetary Fund. Each is a creditor to Greece, and each is expecting the country to repay it billions of dollars of debt in the coming weeks.

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. Athens has been urged to make “serious” proposals as Greece risks defaulting on its €323bn ($356bn; £228bn) debt. Greece’s banks are to stay closed on Tuesday and Wednesday, The BBC reports.

Tension is escalating in the Greek financial markets as the standoff between Athens and Eurozone financial ministers has reached a crucial point.

Over a week after the new Greek government came to power, it has presented its first actual proposal of how it hopes to negotiate with Europe that does not involve the infamous "debt write off", which as both Germany and the ECB have made clear, is a non-starter as it impairs the ECB's balance sheet and leads to a loss of "faith" in the money printer, the legacy monetary system and so on.