Athens has said the writedown deal would see private investors take real losses of more than 70 percent through a 50 per cent cut in the face value of the bonds, along with lower interest rates and a longer repayment period than originally planned. It has also called for the ECB and national central banks to take part in the debt relief agreement, and indicated it was seeking a lower interest rate for the first bailout.
Greece has been surviving since May 2010 on rescue loans from a euro110 billion bailout package from other eurozone countries and the IMF. In return, it has pushed through tough austerity measures, including public sector salary and pension cuts and repeated rounds of tax hikes. Despite the measures, however, the country has failed to meet the targets set out in its bailout agreement, and now needs a combination of the bond deal and a second bailout to prevent a default that could roil the euro currency.
A meeting between Prime Minister Lucas Papademos and the heads of the three parties in his interim coalition government was expected to be held Saturday, according to government officials. The leaders must commit to the new agreements and whatever further austerity measures they entail for the deals to go ahead.
Speaking from Brussels, Tardio said that while negotiations were "extremely complex," he believed an agreement was within reach "in the days to come."
Venizelos stressed the decisions to be taken in the coming days were critical.
"We must save the country, we must now all together, united ... fight this battle. Tomorrow is the day of truth for all the political parties, for the country's political leadership."
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Nicholas Paphitis in Athens and Mike Corder in The Hague contributed.
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