Greece’s international creditors have said they are close to a deal that would unlock €15.5bn (£10.9bn) in rescue funds for the debt-laden country, despite signs of hardening political opposition in Athens as Greek prime minister Alexis Tsipras accused lenders of “blackmail”.

Greece’s creditors – the European commission, European Central Bank and International Monetary Fund – are ready to offer the nearly-bankrupt nation €15.5bn in bailout funds in a five-month extension of the bailout until the end of November.



One EU source said the two sides were 90% of the way to a deal which would involve spending cuts in exchange for financial assistance. Disagreements over pension spending have been resolved and differences over VAT reforms have almost been squared.



However, Tsipras left an EU leaders’ summit with harsh words for the creditors’ offer, while members of his government slammed the prospect of a bailout extension back in Athens. “The European Union’s founding principles were democracy, solidarity, equality and mutual respect. It was not based on blackmail and ultimatums,” said Tsipras. The Greek labour minister, Panos Skourletis, said: “We have moved from a take-it-or-leave-it scenario to the proposal of a five-month extension that makes no sense.”

The German chancellor Angela Merkel said Greece had been made “a very generous offer” by the creditor institutions. “We have taken a step,” she said. “I believe it is not time for Greece to make a similar step in our direction.”

Jean-Claude Juncker, the president of the European commission, dismissed Tsipras’s accusations of blackmail. “The position of the institutions is not a take-it-or-leave it [deal],” he said. “It is not European not to listen to the others,” he said in an apparent dig at Tsipras.

But EU sources sounded confident that they were getting close to agreement. “It’s ridiculous to block agreement for so little,” one EU negotiating source said.

Greece is still holding out on limiting defence spending cuts, while privatisation arrangements for regional airports have yet to be agreed, but sources say differences are minimal.

Another eurozone source said Tsipras had to get the deal through the Greek parliament on Sunday to secure the five-month extension before Tuesday, the day Greece must repay €1.6bn to the IMF and when its bailout programme expires. Without a bailout programme in place, the ECB is expected to pull its support for the Greek banking system, which would probably trigger capital controls in Athens.

If the deal is agreed, it will have to be approved by the Greek parliament and the German bundestag.



The €15.5bn offer consists of €8.7bn from the eurozone bailout fund, €3.5bn from IMF and €3.3bn from ECB bond profits due to Greece.

Eurozone finance ministers will hold a last-ditch meeting on Saturday in a bid to get a deal, following four failed attempts over eight days.

Days of back-to-back meetings involving Europe’s most powerful leaders and finance ministers have failed to break the deadlock, leaving Greece’s future in the eurozone hanging by the finest of threads.

But Merkel has made it clear she wants a deal before Monday when the financial markets and the banks reopen after the weekend.



The pressure on Greece is immense as the ECB has pressed pause on emergency funding for Greek banks. The Greek financial system has received about €89bn of emergency liquidity funds from the ECB, but the tap has been turned off in recent days. The ECB did not increase emergency funds on Thursday or Friday, having increased it on five previous consecutive days.

Although Greek banks are running out of cash, it is far from clear whether Tsipras can carry the rest of the ruling hard-left Syriza coalition with him on the bailout deal.

One Syriza MP, Costas Lapavitsas, said leaving the eurozone could offer fresh hope and was preferable to “blackmail” by Greece’s creditors. Writing in the Guardian, he said Greece had come face to face with the “ruthless reality” of the eurozone.

“The ‘institutions’ are once again attempting to impose the policies that have failed abysmally since 2010, causing huge contraction of GDP, vast unemployment and mass impoverishment. [Accepting the proposal from the institutions] would be a national disaster accompanied by the complete humiliation of the Syriza government.”