ATHENS - Greece has been under pressure to finalise reform proposals that would keep its loan lifeline open after an EU compromise deal clipped its anti-austerity ambitions.
The new hard-left government in Athens has until Monday to convince its sceptical European creditors that it could piece together a credible set of alternative fiscal reforms.
After a last-ditch negotiation on Friday that saw his government dramatically climb down from its radical agenda, Prime Minister Alexis Tsipras insisted that Athens had achieved an "important negotiating success" which "cancels out austerity".
In a televised address, Tsipras said his government had foiled a plan by "blind conservative forces" in Greece and abroad to bankrupt the country at the end of the month, when its European bailout had been scheduled to expire.
But as fears of a disastrous Greek exit from the eurozone receded, the 40-year-old premier warned that the "real difficulties" lie ahead. He said his government would now focus on negotiating a new reform blueprint with Greece s creditors by June.
The new leftist government, which came to power last month pledging to end deeply unpopular austerity measures and renegotiate Greece s huge debt, had asked for a six-month loan assistance until it can submit its four-year reform plans.
Instead, it received a maximum of four months in which to reach an agreement with its eurozone partners, but no money to tide it over in the meantime.
Markets reacted positively to the deal, with Wall Street soaring to new records as news of the agreement broke.
French President Francois Hollande tried to sweeten the pill for Greeks, talking about a "good compromise" that gives Athens time to finalise its reform plans.
But the government s domestic rivals were less generous.
"If this is successful negotiation , what would count as a fiasco?" asked conservative former prime minister Antonis Samaras.
The opposition socialists said the deal took Greece "kilometres backwards" and accused the new government of engaging in "theatrics for domestic consumption".
"From a symbolic and therefore political point of view, the Greeks yielded on everything," Daniel Gros, director of the centre for European policy studies, told Italy s La Stampa daily.
"They can hope to receive nothing now... only to give," Gros said.
The government said it had averted threatened cuts to pensions and tax hikes, and had persuaded its European creditors to drop unrealistic budget demands.
Some Greeks on Saturday said even this was better than nothing.
"The room for negotiation was certainly limited, but this deal is in the right direction and makes us feel relieved," said civil servant Alexandros Mylonas.
"This is a very positive development," added Nikos, a pensioner who declined to give his surname.
"We could certainly do no worse than where we were before," he said.
To win the hard-fought deal, the government pledged to refrain from one-sided measures that could compromise existing fiscal targets, and had to abandon plans to use some 11 billion euros in leftover European bank support funds to help restart the Greek economy.
On Tuesday, the detested "troika" of creditors will decide whether to proceed with Friday s agreement, with the chance that the compromise could be scrapped if they are not satisfied.
"If the list of reforms is not agreed, this agreement is dead," Greek Finance Minister Yanis Varoufakis admitted after the talks.
The government had promised to spend two billion euros this year on poverty relief for thousands of families hit by five years of wage cuts and tax hikes.
Last week it presented legislation offering debt forgiveness to low-income citizens owing money to the state, but Brussels has now demanded to vet such measures beforehand.
"We do not think this is a one-sided measure that will cause problems," Junior Finance Minister Dimitris Mardas told Mega television on Saturday, arguing that the move would encourage debt settlement and actually increase state revenue.
The 19 eurozone finance ministers reached the agreement at tense talks pitting Greece against an angry Germany, suspicious that the new government in Athens was looking to ditch its austerity obligations.
"The meeting was intense because it was about building trust between us," said Eurogroup head Jeroen Dijsselbloem, after the talks ended with a two-page statement setting out the tough conditions Athens will have to fulfil.
"This trust will be on the basis of the agreements and changes in the agreements which will have to be worked out," he said.
Two previous rounds of talks had ended in acrimony with Greece accusing Germany and other hardline EU member states of sabotaging a deal.
If Athens sticks to its commitments, it stands to receive up to 7.2 billion euros in funds still left in its 240 billion euro bailout (US$273 million) from the EU and the International Monetary Fund. AFP