Greece and its international lenders agreed on Friday on the key elements of reforms to unlock new funds, and experts will now put finishing touches on the deal, the chairman of the euro zone finance ministers said.

Greece is on its third bailout from euro zone governments since 2010. To get money, it has to pass regular reviews of reforms by experts sent by the lenders.

The latest review has dragged on since the middle of last year because of differences over pension and income tax reforms that some lenders believe Greece must undertake to put its finances on a sustainable footing.

“Today we have an agreement on . . . overarching elements of a policy package in terms of size, timing and sequencing of reforms,” the eurogroup chairman Jeroen Dijsselbloem told a news conference.

“On that basis, further work will continue in the coming days.” Experts will be sent to Athens to finalise the deal

Greece will take steps to produce savings in its pensions system of 1 per cent of GDP annually starting in 2019, an election year. Another 1 per cent annually is to come from reform of the income tax system in 2020.

The additional reforms are mainly to satisfy the International Monetary Fund and Germany, which have been sceptical that Greece would be able to reach previously agreed fiscal targets without them. To make the deal more palatable for Athens, the lenders agreed that if Greece exceeds its targets as a result of the additional measures, it can spend the excess cash on boosting the economy.

Meanwhile, Mr Dijsselbloem, said on Friday he did not intend to resign before his mandate ends in January, his latest attempt to put down calls for him to quit. – Reuters