The country’s leftist Prime Minister Alexis Tsipras agreed to tough reforms after 17 hours of gruelling negotiations in return for a three-year bailout worth up to 86 billion euros ($96 billion), Greece’s third rescue programme in five years.
EU President Donald Tusk announced the deal for debt-stricken Greece on Twitter, ending a bitter six-month struggle between Tsipras’s anti-austerity government in Athens and the rest of the eurozone.
“EuroSummit has unanimously reached agreement,” former Polish premier Tusk said. “All ready to go for ESM programme for Greece with serious reforms and financial support.”
Greece applied last week for a third programme from the eurozone’s bailout fund, the European Stability Mechanism, after its previous bailout expired on June 30, leaving it without international financial assistance for the first time in years.
Greek banks have been closed for nearly two weeks and there were fears they were about to run dry due to a lack of extra funding by the European Central Bank, meaning Athens would have had to print its own currency and effectively leave the euro.
Athens had infuriated its creditors with actions including a surprise referendum on July 5 in which Greeks overwhelmingly rejected previous bailout terms offered by its creditors.