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 After walking into a party meeting to applause, Tsipras rallied
his Syriza lawmakers to throw their weight behind the new proposals
ahead of a snap vote in parliament on the negotiations, urging them
to help keep Greece in the euro.
"We are confronted with crucial decisions," a government official
quoted Tspiras telling his Syriza lawmakers.
"We got a mandate to bring a better deal than the ultimatum that the
Eurogroup gave us, but certainly not given a mandate to take Greece
out of the eurozone, he said. "We are all in this together."
It is unclear whether all the creditors would back the latest
reforms package, which was strikingly similar to the terms Greece
had rejected in a referendum that Tsipras had called in June.
France, Greece's strongest supporter in the euro zone, rushed to
offer praise with President Francois Hollande calling the offer
"serious and credible". Eurogroup head Jeroen Dijsselbloem called it
a "thorough piece of text" but declined to go into specifics.
"Broad support in Greece gives it more credibility, but even then we
need to consider carefully whether the proposal is good and if the
numbers add up," he told reporters. "One way or the other, it is a
very major decision we need to take."
 The lenders' backing is crucial for euro zone leaders to support the
proposals. Dijsselbloem, European Commission President Jean-Claude
Juncker, European Central Bank President Mario Draghi and
International Monetary Fund head Christine Lagarde will make a first
assessment of the plans by teleconference at 1100 GMT (7:00 a.m.
EDT), EU sources said.
European markets rallied on the improved prospects for a last-ditch
deal to keep Greece in the currency area, while Italian, Spanish and
Portuguese bond yields fell, reflecting perception of reduced risk.
Nevertheless, Greece would have to overcome a hardening of attitudes
toward it among its euro zone partners, including Germany, which has
contributed more to Greek bailouts than any other country. Some,
including a senior member of German Chancellor Angela Merkel's
party, greeted the latest reform proposals with scepticism. Latvia's
prime minister said he would not accept any proposal that includes a
debt writedown.
Finance ministers of the 19-nation euro area will meet on Saturday
to decide whether to recommend opening negotiations on a third
bailout program for Athens despite widespread exasperation at the
five-year-old Greek debt crisis.
Greece asked for 53.5 billion euros ($59 billion) to help cover its
debts until 2018, a review of primary surplus targets in the light
of the sharp deterioration of its economy, and a "reprofiling" of
the country's long-term debt.
But the plan could cause trouble for Tsipras at home, from
hardliners in his own party as well as his junior coalition ally.
Any new deal would also have to be endorsed by national parliaments
including in Germany.
"The proposals are not compatible with the Syriza program," Energy
Minister Panagiotis Lafazanis, who belongs to the hard left wing in
Syriza, told Reuters.
He declined to say how he would vote. "We will take it step by
step."
A small group of pensioners held a protest outside the finance
ministry in Athens and an anti-austerity demonstration is planned
for Friday evening.
"The new measures are suffocating," said Irini Skordara, a
79-year-old pensioner, one of dozens of pensioners queuing outside a
bank to withdraw their pension. "Better we live poor than to plunge
into chaos."
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Tsipras has called a snap vote in parliament asking for its backing
to negotiate a list of "prior actions" - measures his government
would take to convince creditors of its intent ahead of negotiations
and to secure the first disbursement.
"THE RIGHT CHOICE"
The latest offer includes defense spending cuts, a timetable for
privatizing state assets such as Piraeus port and regional airports,
hikes in value added tax for hotels and restaurants and slashing a
top-up payment for poorer pensioners.
"The 'No' in the referendum appears to be turning into a 'Yes' from
Tsipras," Commerzbank analyst Markus Koch said.
Greek banks have been closed since June 29, when capital controls
were imposed and cash withdrawals rationed after the collapse of
previous bailout talks. Greece defaulted on an IMF loan repayment
the following day and now faces a critical July 20 bond redemption
to the ECB of 3.49 billion euros, which it cannot make without aid.
The country has had two bailouts worth 240 billion euros from the
euro zone and the IMF since 2010, but its economy has shrunk by a
quarter, unemployment is at more than 25 percent and one in two
young people is out of work.
"The prime minister seems to have made the right choice between his
party and the interest of Greece," an editorial in the center-right
daily Kathimerini said.
"His decision to accept a tough package of measures will ensure the
country stays in the euro. This is not the time for gripes and
assessing the damage, what's most important is securing the
country's interests and its place in the euro zone."
Germany made a small concession on Thursday by acknowledging that
Greece will need some debt restructuring as part of the new program
to make its public finances viable in the medium-term.
"What is most important is that the package of measures will have
the parliament's authorization, not only from the two ruling parties
but also the other three pro-European parties of the opposition -
New Democracy, Potami and PASOK," the Greek newspaper Ethnos said.
"It is a consensus that has been delayed for five years, costing
Greek people a lot. But what really counts is that it came about at
last, perhaps at the most appropriate time."
(Reporting by Renee Maltezou, George Georgiopoulos, Marius Zaharia,
Alastair Macdonald, Caroline Copley, Georgia Kalovyrna, Anthony
Deutsch, Toby Sterling, Julien Ponthus; Writing by Matthias
Williams; Editing by Paul Taylor, Anna Willard and Peter Graff)
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