Eurozone governments threw Greece another eleventh hour credit lifeline on Thursday worth 9.5 billion US dollars and sketched new detail on possible debt relief as the International Monetary Fund (IMF) finally offered to help out after two years of hesitation.

The 8.5 billion euros of loans from the eurozone's 18 other states, including Germany, which is wary of easing terms for Greece ahead of a German election in September, lets Athens avoid defaulting on bailout repayments next month and recognizes unpopular cuts and reforms the left-wing government has made.

"There is now light at the end of the tunnel," Greece's finance minister Euclid Tsakalotos told reporters after meeting fellow eurozone finance ministers and IMF chief Christine Lagarde in Luxembourg. 

The accords gave enough clarity to investors on how Greece can manage its crushing debt burden that it should be able to borrow on the market again "in due course" after effectively relying on bailout support from other sovereigns since 2010.

A proposal by the French government under new President Emmanuel Macron to help bridge differences on debt relief will underpin further euro zone discussions, officials said. Macron wants to work with Germany to strengthen the 18-year-old common currency, which was nearly wrecked by the sovereign debt crisis.

Bruno Le Maire, France's finance minister, center, speaks to journalists as he arrives for a Eurogroup meeting of European finance ministers in Luxembourg on Thursday, June 15, 2017. /VCG Photo

German Finance Minister Wolfgang Schaeuble, whose insistence on austerity reforms to public finances in Athens have long made him a hate figure for many Greeks, said lawmakers in Berlin would review the deal on Friday to see if it deviated from a 2015 bailout enough to need new German parliamentary approval.

Elderly Greek citizens marched through central Athens to protest against further pension cuts imposed by the government as part of efforts to ensure that Greece gets its next installment of rescue loans from European creditors. Demonstrators complained that the average monthly pension per capita was slashed to less than half of its figure eight years ago.

Eurozone bailout fund chief Klaus Regling said his European Stability Mechanism would disburse 7.7 billion euros in early July to cover 6.9 billion euros in maturing debt and 0.8 billion of arrears. A further 0.8 billion euros would be disbursed "after the summer".

The IMF would join the current bailout, Lagarde said, offering Athens a standby arrangement of less than two billion US dollars, the length of which will be tailored to match the end of the eurozone bailout in mid-2018.

(Source: Reuters)