Debt crisis

Greek radio said the financial rescue plan is worth 20-25 billion euros ($27-34 billion) utilizing combined funds from the EU and the International Monetary Fund (IMF). Interest rates are to be set at 5.1 percent, significantly lower than the 7.5 percent markets have been offering. Sources said the deal was almost a "carbon copy" of IMF terms.

Jean-Claude Juncker, who heads the Eurogroup, and European Monetary Affairs Commissioner Olli Rehn are scheduled to announce details of the plan on Sunday.

"There will be a teleconference on Sunday on Greece in the usual Eurogroup composition," Guy Schuller, a spokesman for Juncker, said. "Greece has not asked for help, but you have to be ready if they do".

Loaded gun

Greek Prime Minister George Papandreou told To Vima newspaper that Athens may be forced to use the financial rescue package to tackle its 300-billion debt if markets remain skeptical as speculation mounts that Greece could default.

Papandrreou said that with the terms now set the gun on the table will be loaded. Speculators will know this, he added.

"The question remains whether this mechanism will convince markets just as a gun on the table. If it does not convince them, it is a mechanism that is there to be used," Papandreou said.

Papandreou has vowed that Greece had no plans of leaving the euro-zone.

"The euro is not to blame for our problems. Greece belongs in the euro-zone. Any other scenario is ridiculous," he said.

Spanish Foreign Minister Angel Moratinos, whose country currently holds the EU Presidency, was optimistic: "I am quite optimistic that we are again able to show solidarity and above all send a message to the speculators that the euro-zone is strong and firm."

EU leaders last month agreed to a bailout plan for Greece as a last resort, with the EU providing much of the funding through direct loans and the IMF also providing assistance.

nrt/AFP/Reuters

Editor: Sonia Phalnikar