(MENAFN- AFP) Greece's new anti-austerity government submitted a preliminary list of reform proposals to Brussels on Monday in a bid to secure a four-month extension to its lifeline debt bailout, a European source said.
If the measures fail to win the approval of Greece's EU creditors, the country's safety net will collapse on Saturday leaving the government at risk of running out of cash, a run on banks and even a eurozone exit.
But hard-left Prime Minister Alexis Tsipras, whose Syriza party swept to power in elections last month, could also face a voter backlash if he fails to deliver on promises to ease the pain of ordinary Greeks after years of swingeing government spending cuts.
In the latest in a series of dramatic showdowns over Greece's 240-billion-euro ($270-billion) bailout, flamboyant new Finance Minister Yanis Varoufakis secured the extension from his 18 fellow eurozone partners in Brussels on Friday.
The tentative agreement boosted global markets as fears eased of a "Grexit" or eurozone exit -- which could have highly damaging wider ramifications -- and stocks mostly rose in Asia and Europe.
The deal however came with the proviso that Athens provide by Monday a list of measures to quash concerns, not least in powerhouse Germany, that Greece might backtrack on its commitments to cut spending and pass root-and-branch reforms.
"Europe has some breathing space, nothing more, and certainly not a resolution," German Foreign Minister Frank-Walter Steinmeier told the Bild daily on Monday.
"The fundamentals -- namely assistance in exchange for reform -- must remain the same."
EU Economic Affairs Commissioner Pierre Moscovici told France 2 television that Greece's proposed reforms had to be "realistic".
"Of course there will be measures that fit with the philosophy of Syriza... but they also have to take account of budgetary balance and the need to repay debts," Moscovici said.
In Berlin, a finance ministry spokesman said the list needed to be "coherent and plausible".
- Reality bites -
Tsipras, 40, has vowed to end the "humiliation" and "vicious circle" of the spending cuts demanded by Greece's creditors in return for two massive bailouts since 2010.
He wants to use the next four months to draw up a new reform package that puts the country -- where one in four people is out of work -- on a fairer road to recovery after years of recession, spending cuts and state job losses.
But the tough negotiating stance of Germany and other eurozone countries has obliged the former student radical and his tieless finance minister Varoufakis, 53, to give ground.
Athens pledged to refrain from one-sided measures that could compromise fiscal targets and had to abandon plans to tap some 11 billion euros in leftover European bank support funds.
UniCredit economist Erik Nielsen called it a "complete political surrender to the world of reality", saying that it was clear that Europe has "drawn the line in the sand".
Tsipras insisted at the weekend that his coalition government had achieved an "important negotiating success" which "cancels out austerity".
Government spokesman Gabriel Sakellaridis insisted on Skai television Monday that Greece still has "red lines" such as raising the minimum wage and maintaining pension levels.
But cracks were already beginning to show, with Manolis Glezos, a 92-year-old wartime resistance hero and one of Syriza's most respected members, distancing himself from Tsipras.
- Tax hit list -
The source in Brussels said the list received on Monday was "not definitive". Others said that Brussels and Athens were in regular communication and seeking to finalise the document by a midnight (2300 GMT) deadline.
There were few details about the new measures.
Minister of state Nikos Pappas told television channel Mega on Sunday they were aimed at making "the Greek civil service more effective and to combat tax evasion".
According to Bild, this will include a 7.3 billion-euro tax hit list targeting the fortunes of the super-rich, back taxes on companies and a crackdown on smuggling.
Once the European Commission, the European Central Bank and the International Monetary Fund -- the "troika" of Greece's creditors -- approve the list, the extension can go ahead. Certain European parliaments also need to give the green light.
But if the proposals are not approved, it will be back to the drawing board and yet more drama for Greece, which is struggling under a 320-billion-euro debt mountain.
"The chance of policy mistakes, political volatility and implementation risks remains quite high, and may rise," said Daniele Antonucci, economist at Morgan Stanley.
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