Greece pledges circuit-breaker

Reforms an end to our woes – Tsipras

GREECE will today announce it will enact tax and pension reform in exchange for a three-year financial bailout package the government hopes will avert its collapse and keep the country in the euro zone.

After a jocular start to a summit on Tuesday that attracted the ire of EU leaders, Greek Prime Minister Alexis Tsipras has now taken a more sombre tone as he announced new reform measures could begin as early as next week.

There was no detail behind his announcement but he had until today to present to a sceptical EU forum a cost-accounted reform plan on the day branded Greece’s absolute last chance.

Mr Tsipras assured it would provide a “definitive end” to his country’s financial woes.

“We need to ensure the medium-term funding of our country with a development and growth program,” he told EU politicians in Strasbourg.

His words were greeted with positivity but caution.

Spain’s Prime Minister Mariano Rajoy said: “The tune has changed, it’s not what we were hearing until now and that’s positive.”

Many others however feared the “new” package would include the old already rejected features such as a request for the EU to wipe off 30 per cent of the debt as a goodwill gesture.

Such a move would be blocked by Chancellor Angela Merkel with 100 of her own MPs threatening a rebellion if she moves to back down. German opinion polls have also hardened, with 92 per cent of Germans reportedly against a third bailout plan.

Greece has already had two bailouts from its European partners and the International Monetary Fund since May 2010, totalling ¤240 billion ($A358 billion) with overall debt topping ¤323 billion and defaulted on one payback plan and is due to default on a second toward the end of this month.

Despite Mr Tsipras’ pledge, many analysts predict the nation will move to a Grexit by week’s end.

A Reuters poll of EU economists and experts has shown

The tune has changed, it’s not what we were hearing until now and that’s positive

SPAIN’S PRIME MINISTER MARIANO RAJOY

for the first time 55 per cent believe that a Grexit will happen.

Both France and the White House warned of a geopolitical consequences if Greece fell, interpreted to involve Russia, which has already moved to strengthen an alliance with Greece.

Meanwhile, Greek State television has reported that all banks in Greece would continue to remain closed until at least Monday and that all capital controls, including sending money offshore and withdrawing more than ¤60 a day, would continue.

Banks were to have been opened today. The financial controls were issued more than a week ago as an interim measure.

Latest predictions based on the levels of constant ¤60 ATM withdrawals by the entire population is that cash reserves will run out by tomorrow.