Talks end with Angela Merkel affirming government of Alex Tsipras must deliver promised list of structural reforms before further bailout

Greece’s European creditors insisted early on Friday morning that Athens would need to present a “full and adequate” list of persuasive economic reforms before it could receive a lifeline in bailout funds.

Europe’s longrunning drama over whether Greece will stay in the single currency returned to the centre of EU politics on Thursday. Alexis Tsipras, the new leftwing prime minister, used his second Brussels summit to demand emergency talks with the political leaders of his key creditors.

Following three hours of talks that ended after 2am, the German chancellor, Angela Merkel, made it plain that there would be no quick disbursement of emergency aid to Greece unless Tsipras delivered on unfulfilled pledges to supply a full menu of proposed structural reforms to the Greek economy. The credibility of Tsipras’s proposals would need to be supported by eurozone governments before Greece, on the brink of insolvency, could obtain the financial support.

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Despite the reluctance of other EU leaders to prioritise Greece in a summit scheduled to deal with issues including Ukraine and the Libya crisis, the prime minister was granted a special meeting with Merkel as well as Mario Draghi, the president of the European Central Bank; the French president, François Hollande; Donald Tusk of Poland, who chairs the summits; and Jeroen Dijsselbloem, the Dutch finance minister who heads the Eurogroup of finance ministers.



Both sides – Merkel and Draghi on the one hand and Tsipras on the other – went into the talks with little sign of a shift in their respective stances. A rapid breakthrough was not expected despite the sense that time is not on Athens’s side and that it could run out of money, possibly within weeks.

If there is to be any breakthrough it is more likely to come on Monday when Tsipras goes to Berlin to see Merkel again, diplomats and officials have said.

Following an agreement to extend until June Greece’s €240bn (£173bn) bailout – brokered by the EU, the ECB and the International Monetary Fund – on condition that Athens delivers on promised fiscal and structural reforms to it economy, things have gone from bad to worse in the relationship.

Unsuccessful and bad-tempered meetings this week between the two sides in Athens have left Greece looking isolated. Tsipras pushed two bills through parliament on Wednesday granting relief in the form of food stamps and free electricity to those hardest hit by the savage austerity of the past five years.

Eurozone officials complained that this should not have happened without their blessing, accusing Tsipras of “unilateral” action. He responded robustly, arguing that the days of Greece taking orders from its creditors were over and that he was asserting Greece’s economic and political sovereignty.

The decision to interrupt the summit to enable a smaller-format negotiation with Tsipras also ruffled feathers among eurozone creditors not taking part in the talks. “I’m angry,” said Charles Michel, the Belgian prime minister. He was joined by the Dutch and Luxembourg leaders who held up the beginning of the summit by almost an hour because of an “exchange of information” on the row with Tusk. They also insisted that the rest of the summit be briefed on the Tsipras talks, probably on Friday.

Merkel has gone out of her way to avoid confrontation with Tsipras although the war of words between Berlin and Athens has grown notably fiercer over the last two weeks.

Wolfgang Schäuble, the German finance minister, accused the Tsipras government of lying to its public and of wrecking the trust of its eurozone partners this week.

At an EU summit last month, senior EU officials said, Merkel pressed Tusk to keep the Greek issue off the agenda and there was minimal discussion of the issue at what was Tsipras’s first EU summit.

Tusk, who organises and chairs EU summits and performs the same function for the eurozone, has also resisted pressure from several quarters to convene a special Eurogroup summit on Greece, he told the Guardian and other European newspapers only a few days ago.

“Can you imagine in the worst moment discussions between chancellor [Merkel] and Tsipras? It would be useless,” he said.

The decision to convene a special meeting with Tsipras and the other leaders on Thursday evening marked a big shift in these avoidance tactics.

Ahead of the summit on Thursday, Merkel raised laughs in the Bundestag in Berlin by declaring she was not shy of having “an argument” with Tsipras.

While neither side wants Greece to leave the euro, there are growing fears that the eurozone may be sleepwalking into precisely that scenario because of the brinkmanship on both sides.

Tusk describes a Greek departure from the euro as “idiotic” but also concedes that the chances of “Grexident”, or an accidental Greek exit, have risen.

The Greeks are in talks to draw on more than €7bn in bailout funds by June, while negotiating a third rescue package to follow from July. But to obtain the money they first have to present a coherent reform programme that can gain the backing of the country’s creditors.

Eurozone officials and leaders are increasingly exasperated that Tsipras refuses to deliver persuasive and detailed policy proposals that might trigger the release of the funds.

He is expected to ask for the prompt release of some funds, arguing that Greece faces a short-term liquidity problem. The ECB could help but Draghi has so far resisted Greek pleas.

Martin Schulz, the president of the European parliament, said on Thursday that Athens was running out of money and needed around €3bn urgently.