Eurozone finance ministers regroup for crisis talks

Eurozone finance ministers attempting to reach a verdict on Greece's last-ditch reform proposals were expected to reconvene Sunday at 11 a.m. (0900 UTC) in Brussels.

Emergency talks were halted at midnight after nine hours of bailout discussions failed to produce an agreement. The Eurogroup, which includes finance ministers from the 19-country euro currency area, only has a few hours to arrive at a position before a crucial summit of the eurozone leaders convenes on Sunday afternoon.

A summit bringing together all 28 leaders of the European Union that was scheduled for Sunday evening has now been canceled by EU President Donald Tusk.

In a tweet, Tusk said that the summit of the 19 eurozone leaders was to "last until we conclude talks on Greece."

Talks 'very difficult'

"We haven't concluded our discussions," Eurogroup chief Jeroen Dijsselboem told reporters in Brussels, adding that the talks were "still very difficult, but work is still in progress."

Greek Finance Minister Euclid Tsakalotos is seeking to convince his country's international lenders - the European Commission, European Central Bank (ECB) and International Monetary Fund (IMF) - that Athens can make good on its promise to implement tough new reforms in exchange for billions of euros in rescue funds.

Greece's proposed measures - which include a pension overhaul, tax hikes and privatizations - were approved by the country's parliament on Saturday, and had also received cautious backing from lenders.

Trust issues

Several finance ministers meeting in Brussels have raised concerns about a lack of substance in Greece's submitted proposals, and about whether the cash-strapped country could be trusted to implement its reforms.

"We had an in-depth discussion of the Greek proposals and the issue of credibility and trust was discussed, and also of course the financial issues involved," Dijsselboem said after Saturday's meeting was adjourned.

According to the Reuters news agency, officials demanded to see further commitments from Athens on product market liberalization, labor laws, privatization, state reform and defense cuts.

A source close to the negotiations told German news agency DPA that more than 10 of the 19 eurozone countries had serious reservations, while France and a few other nations backed the Greek plan.

5-year 'Grexit'

Germany's hardline finance minister, Wolfgang Schäuble, said the eurozone could not rely on Greece to keep its promises.

"In the last months hope has been destroyed in an incredible way," he said. "We are determined to not make calculations that everyone knows one cannot believe in."

Germany's finance ministry on Saturday put forward a position paper criticizing the latest proposals and demanding Greece either vastly improve its bailout-linked reform plan or take a five-year "time out" from the eurozone and restructure its debt.

There were also signs of resistance from Finland, where media reports said the country's parliament had decided it wouldn't support any new bailout deal for Greece.

Economic collapse

Athens has asked its creditors for 53.5 billion euros ($59.5 billion) to keep it afloat over the next three years and prevent its exit from the euro. Greece has already received 240 billion euros in two previous bailouts in the last five years.

If the country fails to secure extra funds from its creditors, the country could be left to go bankrupt and crash out of the euro.

tj,nm/jlw (AP, AFP, Reuters, dpa)