Euro zone leaders have made Greece surrender much of its sovereignty to outside supervision in return for agreeing to talks on an 86 billion euros bailout. David Pollard looks at the challenges ahead to keep the near-bankrupt country in the single currency.
A deal done. At least in the eyes of the markets, which jumped on the news. But now for the small print. Monsegur analyst Alexandre Zilliox. (SOUNDBITE) (French) MONSEGUR FINANCE FRENCH FINANCE ANALYST ALEXANDRE ZILLIOX, SAYING: "Whether this will attract growth, whether the country's revenues will rise thanks to reforms on VAT and retirements, it will really depend on Greek state capacity to implement these measures." Greece is promised a massive new bailout. Approaching 90 billion over three years. Talks to clinch it will only start after Greece rushes new measures through parliament. Wednesday this week a deadline for spending cuts, tax hikes and pension reform. Then, it'll be the German parliament's turn to have its say on the deal, according to Chancellor Angela Merkel. Though, further down the road, there's the prospect of a bigger carrot for Greece. (SOUNDBITE) (German) GERMAN CHANCELLOR ANGELA MERKEL, SAYING: "The Eurogroup is ready if necessary to grant longer grace period and longer loan maturities - we talked about it - after the first successful review of the new Greek programme." And until the bailout is confirmed, Greece will have to have emergency funds. It needs 7 billion euros of funding by next Monday to make a crucial payment to the ECB. Another 12 billion needed by mid-August for another payment. While at home, ordinary Greeks are still starved of cash. BGC Partners' Mike Ingram. SOUNDBITE (English) MIKE INGRAM, MARKET COMMENTATOR, BGC PARTNERS, SAYING: ''Greek banks have been shuttered for two weeks. They will certainly need to be recapitalised .... There needs to be a bad bank. How's that going to work out? ..... And of course they're going to need continuing largesse from the ECB.'' 25 billion euros is earmarked for capitalising the banks. That's around half of a new fund to be made up of Greek state assets. Another quarter of that will be used to pay down debt - the rest to invest in an economy in desperate need. SOUNDBITE (English) MIKE INGRAM, MARKET COMMENTATOR, BGC PARTNERS, SAYING: ''We're going to see further cuts in public sector expenditure. Broadbrush, a lot more austerity, probably for ever.'' EU leaders deny the deal undermines Greece's sovereignty. But rebuilding trust between Athens and Brussels could be the biggest job ahead. As for Greece's banks: they're to stay shut for now, according to the finance ministry.