Greece agrees new bailout terms with creditors

Greece finalised a deal with its creditors that will allow it to access the next tranche of its €86bn bailout, said Finance Minister Euclid Tsakalotos after an all-night session of talks.

The agreement hinged on Greece making wide-ranging economic reforms, including controversial new cuts of 18% to pensions in 2019 and making the tax base wider a year later.

"There was white smoke," Tsakalotos said in a reference to the signal given at the Vatican when a new pope is elected.

"The negotiations for a technical deal were concluded on all issues... the way has now been paved for debt relief talks," he added.

Talks had been dragging on for months as Greek officials and their counterparts from the European Union and International Monetary Fund.

The reforms must now be agreed by the Greek parliament before eurozone finance ministers approve the next bailout instalment, possibly at their meeting on May 22. The government has a €7.5bn loan repayment due in July and needs the cash to avoid bankruptcy.

European Economic Affairs Commissioner Pierre Moscovici called the agreement a “positive development following months of complex negotiations”.

“These new efforts agreed by the Greek authorities open the way for a rapid conclusion of the second review. The swift implementation of these commitments should enable the eurogroup to endorse this agreement at its next meeting,” he said in a statement.

“This second review is strategic for Greece as it not only delivers on key reforms to modernise the Greek economy but also secures a credible fiscal path for the years to come.”

“It is now for all partners to reach an understanding on the question of Greece's debt in the coming weeks. It is time to turn the page on this long and difficult austerity chapter for the Greek people. With this agreement, we need now to write a new story of stability, jobs and growth for Greece and for the euro area as a whole."