Summary: The euro zone leaders' agreement with Greece
Euro zone leaders set tough conditions today for Greece to negotiate a third bailout to keep the near-bankrupt country in the euro zone.
Following is a summary of the leaders' statement.
* Greece will request continued IMF support from March 2016.
* Greece to pass by Wednesday measures including simplifying VAT rates and applying tax more widely, cutting back on pensions and making the national statistics agency independent.
* Greece to pass by July 22 measures overhauling its civil justice system and implementing EU bank bail-in rules.
* Greece to set clear timetable for following measures:
- ambitious pension reform;
- product market reform including Sunday trading, pharmacy ownership, milk and bakeries;
- privatise electricity transmission network;
- review collective bargaining, industrial action and collective dismissals;
- strengthen financial sector, including action on non-performing loans and eliminate political interference.
* Greeks shall also take the following actions:
- privatisation, involving transfer of assets to independent fund in Greece designed to raise 50 billion euros, three-quarters of which would be used to recapitalise banks and to decrease debt;
- cut costs of public administration and reduce political influence over it. First proposal to be provided by July 20.
- ensure creditor approval for key legislation before submitting to public consultation or parliament.
The above-listed commitments are minimum requirements to start the negotiations with the Greek authorities.
* Financing needs are 82-86 billion euros. Decision on new package urgently required given financing needs of 7 billion euros by July 20 and further 5 billion euros by mid-August.
* A possible new ESM programme would have to include a 10-25 billion euro buffer for banks.
* Possible debt reprofiling but no nominal haircuts.