Europe cautiously optimistic about debt deal with Greece

BRUSSELS — Greece has finally offered economic reforms that creditors consider potentially acceptable, giving Prime Minister Alexis Tsipras a couple days to turn a spirit of goodwill into a deal that might keep the country from a painful exit from the euro currency.

Even though a firm deal to get Greece more loans remained elusive Monday, leaders from the 19 euro nations and the International Monetary Fund said Tsipras’ new reform plan offered the basis to break a four-month deadlock in talks.

In its compromise proposal, Greece is offering about 8 billion euros ($9 billion) in higher taxes and austerity measures over the next two years, a Greek government official said on condition of anonymity.

Financial officials gave a tentative endorsement to Greece’s proposals for spending cuts and reforms they would make in exchange for billions of euros in fresh loans.

A debt default by Greece could destabilize its banks — Greeks are already withdrawing increasingly large amounts of money — and could in a worst case scenario cause the country to have to leave the euro.