Eurozone finance ministers demanded on Saturday that Greece go beyond painful austerity measures accepted by Prime Minister Alexis Tsipras if he wants them to open negotiations on a third bailout.
Eurogroup chief Jeroen Dijsselbloem described yesterday’s negotiations as “very difficult” but said they were making progress.
The ministers will meet again today (Sunday), just hours before a summit of all 28 European Union leaders.
That meeting is meant to be the final deadline for a deal to prevent Greece crashing out of the euro.
“We have had an in-depth discussion of the Greek proposals, the issue of credibility and trust was discussed and also of course financial issues involved, but we haven’t concluded our discussions,” Mr Dijsselbloem told reporters after nine hours of talks yesterday.
“It is still very difficult but work is still in progress,” he said.
Finnish Finance Minister Alexander Stubb was more upbeat, despite reports that Finland’s parliament has decided it will not allow the government to accept any new bailout deal for Greece.
“We are making good progress,” he said as he left the meeting just after midnight.
Ministers gave no details of the lengthy discussions but sources said there were sharp divisions over whether the latest Greek economic reform proposals go far enough to merit what would be a third bailout programme.
The EU and the IMF along with the European Central Bank bailed out Greece twice before to the tune of €240bn.
Germany has become increasingly frustrated with how Greece has implemented the debt programmes, demanding that it accept harsh austerity measures in return for fresh funding.
A German finance ministry document which came to light during the meeting but was not submitted to ministers said Berlin wanted many more concrete commitments from Greece before it could agree to a new bailout.
Failing that, then Greece should leave the Eurozone for five years until it put its economic house in order, the document said, even though current rules appear to rule out such an option.
Sources said that besides Germany, other member states to take a tough line were Belgium, Finland, Slovakia and Slovenia.
Spain, Italy, Malta were more conciliatory, as were Ireland and Portugal.