Eurozone to hold emergency summit on Greece

The eurozone's 19 leaders will meet in an emergency summit next week to seek a breakthrough in Greece's bailout after talks Thursday ended in acrimony, intensifying fears that the country was heading for bankruptcy and an exit from the euro.

Donald Tusk, who chairs meetings of European leaders, called an emergency eurozone summit for Monday evening to "urgently discuss the situation of Greece at the highest political level." That means Greece's prime minister, Alexis Tsipras, will face off with his peers, including German Chancellor Angela Merkel.

The decision to call the summit is a clear sign that relations between Greece and its creditors are as strained as at any time during the protracted bailout talks.

The eurozone's top official, Jeroen Dijsselbloem, said no progress was made in discussions held among finance ministers in Luxembourg on Thursday. He said Greece proposed too few measures that are credible and serious, and that the talks over the past few weeks "have not progressed."

Greece needs outside financial help if it is to meet debt repayments this summer, starting with 1.6 billion euros ($1.8 billion) it owes the International Monetary Fund on June 30. Without a deal, it faces going bankrupt and even leaving the euro union.

Dijsselbloem said a deal was still possible and that he and his peers were "very committed" to keep Greece in the eurozone.

"Greece needs to become financially independent," he said. "Any deal that simply doesn't deliver that ... would be also a bad deal for the Greek people."

Officials acknowledged that Greece's exit from the euro — or "Grexit" — was now being discussed and that contingency plans were being made. As fears of a potential Grexit swell, there have been signs that Greeks are withdrawing money from their banks in increasing amounts.

Greek Finance Minister Yanis Varoufakis said he told his peers that "we are dangerously close to a state of mind that accepts an accident."

Varoufakis conceded that time is pressing for the country to secure a deal, but he believes an agreement can still be reached.

He said the Greek government accepts that the country needs fundamental reforms. He argued, however, that those pursued in recent years have led to huge economic hardship, including high debt, unemployment, poverty and emigration.

"There is no question that Greece needs to make adjustments," he said. "The question for us is: What kind of adjustments?"

Greece's radical left-led government has been locked in talks with creditors since it was elected in January over what economic reforms and budget cuts it needs to make to get the remaining 7.2 billion euros ($8.2 billion) in its bailout fund.

With the clock ticking, the IMF said Greece's debt obligation at the end of the month is not up for negotiation.

"There is no period of grace of one or two months as I have read here and there," said the IMF's managing director, Christine Lagarde. "It's due on June 30."

Beyond an easing in the austerity measures, the Greek government also wants some sort of restructuring of the country's debt burden, which stands at near 180 percent of annual GDP. That could take the form of lower interest rates on the debt or extending the date by which the debts have to be repaid.

Al Jazeera and wire services