Prime Minister Alexis Tsipras has told international creditors Athens could accept their bailout offer if some conditions were changed. But as Ciara Lee reports Germany said it could not negotiate while Greece was headed for a referendum on the aid-for-reforms deal.
Pensioners take to the streets urging fellow Greeks to say no to the proposed bailout deal. They gathered outside the country's finance ministry as those inside made frantic efforts to salvage a deal with international creditors. The door appeared to still be open for Greece and its lenders, but only just. Prime Minister Alexis Tsipras says he'll accept a bailout if some conditions are changed. He also wants a 29 billion euro loan to cover its debt service payments for the next two years. Germany was having none of it, refusing to negotiate while Greece is still set to hold Sunday's referendum on austerity. Finance Minister Wolfgang Schaeuble. (SOUNDBITE) (German) GERMAN FINANCE MINISTER WOLFGANG SCHAEUBLE SAYING: "We don't know if the Greek government is going to hold a referendum or not, whether it is for or against it. You can't in all honesty expect us to talk with them in a situation like this. We need to wait to see what happens in Greece." With queues forming at many cash machines - and banks struggling to keep them filled - Tsipras is under growing pressure. But key sticking points remain, says FX Pro's Simon Smith. (SOUNDBITE) (English): SIMON SMITH, CHIEF ECONOMIST, FXPRO, SAYING: "Even after months of negotiations, Greece still thinks that we have too much debt and just need to write some of it down and then we will be able to grow. On the other side, the ECB, the EU, the IMF, still think no we'll not be writing down any more debt, you still have to do the hard work." Global financial markets have taken it all in their stride, strengthening Germany's hand. (SOUNDBITE) (English): SIMON SMITH, CHIEF ECONOMIST, FXPRO, SAYING: "I still believe that Greece will leave the euro at some point. It's just a question of when that reality will be faced. There is a decent chance that it may be faced now." MAYBE CUT HERE And if you see the gaps that still remain between the two sides, even at this point in time when the bailout has expired and after many months of negotiations, fundamental differences still remain." Euro zone finance ministers have been discussing the latest developments. Initial reaction suggests the new Greek proposal will be hard to accept.