Greek prime minister Alexis Tsipras will present fresh bailout proposals at the European Union summit on Tuesday, as agreed in a phone call with German chancellor Angela Merkel.
Tsipras spoke with Merkel, interrupting a meeting with leaders of Greece's largest political parties convened by President of the Hellenic Republic Prokopis Pavlopoulos.
POLITICAL LEADERS MEETING
The meeting ended after a seven-hour marathon session with the political leaders issuing an unprecedented joint statement backing the government's efforts to reach a deal with creditors.
They called for immediate steps to reopen banks and said any deal must address debt sustainability - code for reducing Athens' crushing debt - but gave no hint of concessions from the Greek side toward its creditors' demands for deep spending cuts and far-reaching reforms of pensions and labor markets.
Sources close to the talks told to iefimerida.gr on condition of anonymity that the Greek side is seeking for an interim accord which will keep the financial spigot open for July and August.
After the meeting Greece's new finance minister was announced as minister Yanis Varoufakis has resigned after Greek voters delivered an overwhelming "No" vote in a referendum on whether to accept their creditor's proposals. He was replaced by Euclid Tsakalotos, an Oxford-educated economist who is considered more pragmatic than his predecessor.
"We want to continue the discussion," said Tsakalotos, who has admitted to having "stage fright" upon assuming the post.
GERMAN LINE HARDENS
But Berlin said the departure of Varoufakis did not change anything. "It is not about people but rather positions," Merkel's spokesman Steffen Seibert said.
Merkel and French President François Hollande met in Paris on Monday to agree a common stance on Greece. They both urged Greece to quickly put forward serious proposals that EU leaders could work with.
The German chancellor said the door was still open for negotiations but "time is of the essence" and for the euro zone to keep its single currency all countries needed to shoulder responsibility as well as showing solidarity.
"It will be important tomorrow that the Greek prime minister tells us how things should proceed and what precise suggestions he can submit to us for a medium-term program that will lead Greece to prosperity and growth again," Merkel said.
A SERIES OF PHONE CALLS
U.S. Treasury Secretary Jack Lew spoke with both Tsipras the his new finance minister and said Washington looked forward to Athens and other parties resuming conversations toward resolving the Greek situation, a Treasury spokeswoman said.
Late on Monday, the prime minister's office said Tsipras had spoken with EU Commission President Jean-Claude Juncker and Hollande. His office did not provide details about the conversations.
Tsipras was also reported to have spoken to International Monetary Fund (IMF) chief Christine Lagarde "on the need to find a viable solution dealing with the real problems of the Greek economy."
ECB KEEPS LIQUIDITY, CONDITIONALLY
Tsipras told the European Central Bank (ECB) chairman Mario Draghi in a phone call on Monday evening that there was an immediate need for capital controls in Greece to be lifted. Athens has imposed the measures itself in an effort to prevent the collapse of the banking system, but would need help from the ECB to lift restrictions on cash transfers and withdrawals.
The ECB on Monday said it would not increase emergency funding to Greece under the Emergency Liquidity Assistance (ELA) scheme, keeping the level at 89 billion euros Deutsche Welle reports. It also said key financial support could only be provided if Greece could show sufficient collateral.