After 17 hours of negotiations, eurozone leaders on July 13 offered Athens a new 86 billion euro bailout ($95 billion) -- the third bailout for Greece since 2010. This is what you need to know.
Why Is The Deal Important And What Comes Next?
The deal, if approved by the Greek parliament, means Greece will stay in the eurozone after a crisis that raised the most serious prospect yet that it could exit the monetary union, either by jumping or getting pushed by Germany, its biggest and angriest creditor.
The deal also assures Greece, for the short-term at least, of the finances it needs to avoid future defaults on its debt repayments and the collapse of its banking system.
To seal the deal, the Greek parliament will have to approve by July 15 a program of sweeping reforms demanded by the 18 other members of the eurozone. That includes spending cuts, tax hikes, and pension reforms, among them many that the Greek public refused in a referendum on July 5 over the EU's previous bailout conditions.
In one sign of how hard it may be for Greek Prime Minister Alexis Tsipras to convince the parliament and even his own left-wing Syriza party to accept the deal, his Labor Minister Panos Skourletis responded immediately on Greek television on July 13 by saying the terms were unviable and would lead to new elections this year.
If the Greek parliament approves, parliaments in a handful of other eurozone member states must also approve their governments' participation, including in Germany, where the legislature is to meet on July 16.
Who Won The Showdown?
Greek Prime Minister Alexis Tsipras has tried to cast Athens as the winner, saying after the negotiations that Greece fought a "tough battle" and sent a message of dignity to all of Europe. No doubt, keeping Athens in the eurozone amid the acrimony the crisis has generated both in Brussels and in Greece, represents a victory for Tsipras, who has steadily opposed any Greek exit.
If the summit had failed, the prospect of an exit would have become increasingly likely, with Greece having to print a parallel currency to keep its collapsing economy afloat as it moved out of the European monetary union toward an uncertain future.
But the real winner is likely German Chancellor Angela Merkel. Amid rising opposition at home to more aid for Greece, she promised before the negotiations to drive a hard bargain and did so. In the only major concessions to Athens during the talks, Berlin dropped a proposal to make Greece take a "time-out" from the eurozone if it failed to meet Brussels' reform demands. And Berlin dropped its insistence that Greek state assets worth up to 50 billion euros be placed in a trust fund in Luxembourg managed by a German bank while they await privatization sales to help pay down the debt.
The issue of the trust fund's location was deeply felt in Athens, where it is viewed as gross interference with the country's financial sovereignty, so the German flexibility over the fund's location is important.
What Are The Consequences For The Euro?
A new deal may have been reached but the crisis for Greece and the euro remains far from over. The eurozone and the International Monetary Fund (IMF) have lent Greece about 233 billion euros since 2010 and there is no guarantee that the newest proposed loan will be the last.
Nor is there a guarantee that if the Greek government falls in new elections, that its successor might prove more hard-line than the current one sought to be in rejecting EU demands for austerity. That raises the possibility of a repeat of the just-passed crisis and new uncertainty over when and how it will finally end.
Yet more worryingly for the euro, the divisiveness that marked getting a deal over the third bailout could raise investors' doubts about the unified currency's long-term viability. The crisis revealed just how impatient Germany, Europe's strongest economy, has become over the 87 billion euros it alone has lent to Greece to defend the euro, only to see the once powerful currency lose value against the dollar over recent months to the point of near parity.
Some voices in Germany have called not only for Greece to leave the eurozone but for Germany to follow, perhaps to form a smaller currency union with other northern states it views as more fiscally responsible. They point critically not just to Greece but to Spain, Portugal, and Ireland, which have been rocked by earlier bank crises and even to Italy, which remains under the threat of one.
What Are The Consequences For The EU?
The eurozone leaders are likely to spend much of the coming weeks emphasizing that they now have a common position over Greece. But the divisiveness already shown could have knock-on effects for the EU as a whole. One big question is whether it could help the rise of populist anti-EU parties in member states.
So far, Brussels' formula for helping states that run into economic trouble has been to provide money in exchange for reforms. However, the austerity programs that requires create resentment. In Spain, the leftist protest party Podemos has blamed the EU, the European Central Bank, and the IMF for economic suffering in southern Europe and called for an alliance of southern states against Germany. In Italy, protest parties such as the Northern League or the Five Star Movement feel the same. Beppe Grillo, head of the Five Star Movement, says, "It's not that we are anti-euro. The euro is anti-Italian."
Will today's deal add fuel to the anti-EU feeling? It is a question that can only make Brussels nervous.