Middle man ... President Barack Obama has spoken to both Greek PM Alexis Tsipras and German Chancellor Angela Merkel encouraging them to find a solution. Picture: AP/Evan Vucci Source: AFP

Amid growing fear that a greater economic crisis may lie ahead and a 60 euro limit on the amount of cash they can withdraw from ATMs, Greek citizens are frantically using their debit cards to buy ovens, refrigerators, dishwashers and anything tangible that can hold its value in troubled times, the New York Times reports.

“Panicked doesn’t begin to describe how people feel,” said Antonis Mouzakis, an Athens accountant.

“I have a huge number of customers wanting to file their taxes right here, right now, to have the tax calculated and paid instantly before a possible haircut. Even if the tax is 40 to 50 thousand euros, they pay it off in one go.”

Meanwhile, Greek jeweller George Papalexis said a customer had approached him on Wednesday wanting to buy AU$1.48 million worth of merchandise.

Greece has requested a new three-year rescue from its European partners as signs grew its economy was sliding toward free-fall without an urgently needed bailout.

As the Greek banking system teetered near the edge, the government extended bank closures into next week, while international creditors were in open disagreement over whether to award the country debt relief.

If a deal is not secured, Greece faces an almost inevitable collapse of the banking system, which would be the first step for the country to exit the eurozone.

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Change of heart ... Greek Prime Minister Alexis Tsipras said the country will make immediate reform changes. Picture: AP/Jean-Francois Badias Source: AP

Greek Prime Minister Alexis Tsipras has confirmed government authorities will race to submit “credible” reform plans to the eurozone on Thursday as demanded by leaders of the currency union at their latest emergency summit.

This would give enough time to review the plan before all 28 leaders of the European Union meet on Sunday.

“The Greek government... will tomorrow file new concrete proposals, credible reforms, for a fair and viable solution,” he told the European Parliament in Strasbourg on Wednesday in a last-ditch effort.

Greece has requested a three-year loan from Europe’s bailout fund and has pledged to “immediately implement” tax and pension related measures as of Monday.

In the letter sent to the European Stability Mechanism earlier, the government said it will “set out in detail its proposals for a comprehensive and specific reform agenda” on Thursday at the latest.

Greece’s aim, the letter went on, was to regain “full and affordable market financing to meet its future funding requirements as well as sustainable economic and financial situation” by the time the loan ends at the latest.

HITTING HARD: Broke Greeks desperate for a feed

The letter also says the country is committed to honouring its financial obligations to its creditors on time.

“We trust Member States appreciate the urgency of our loan request,” it said.

Spanish Prime Minister Mariano Rajoy welcomed what he said was a “positive” change in tone from Greece, which has pledged to make “credible” reforms to try to win a new bailout deal.

“The tune has changed, it’s not what we were hearing until now and that’s positive,” Rajoy said at a press conference in Madrid.

Talking tough ... International Monetary Fund chief Christine Lagarde speaks in Washington, DC on Wednesday. Source: AFP

IMF head says the rules won’t be bended for Greece

International Monetary Fund managing director Christine Lagarde stressed on Wednesday that a new plan to prop up Greece’s finances would require creditors to restructure debt.

In addition to the reforms Athens needs to undertake, she said, “the other leg is debt restructuring, which we believe is needed in the case of Greece for it to have debt sustainability.” “Greece is in a situation of acute crisis which needs to be addressed.”

This is a move that Germany, Greece’s largest European lender, has resisted.

Lagarde said the numbers themselves “will have to be revisited,” but added that Greece, which no longer has access to IMF resources since its default on June 30, should not benefit from any special treatment.

“It is certainly my view that the IMF has to follow its rules, should not bend its rules and should be always even-handed.”

She justified the Fund’s continued participation in new aid talks for Greece even if Athens has been a severe critic of the institution.

But, she said, the IMF is involved “because the IMF was asked by Greece to be involved.”

Embarrassing ... Newly appointed Greek Finance Minister Euclid Tsakalotos showed up to the European leaders summit with a few bullet point notes he had jotted down on the bedside notepad from his hotel. Picture: AFP/JOHN THYS Source: AFP

Embarrassment for new finance minister

Earlier Tsipras and newly appointed Greek Finance Minister Euclid Tsakalotos turned up to a European leaders summit with nothing, except Tsakalotos who embarrassingly had a few bullet point notes he had jotted down on the bedside notepad from his hotel.

The image of him clutching this one hotel monogrammed sheet of notes was beamed around the world, featuring notations like “state of play” and “no triumphalism”, apparently to remind himself not to boast about his Leftist government’s victory at the referendum that attracted 61 per cent of voters to say ‘No” to further aid packages in exchange for austerity.

It was a referendum result European Commission president Jean-Claude Jucker dismissed at the summit as an “irrelevant circus”.

Remains hopeful ... Greek Finance Minister Euclid Tsakaloto said he was buoyed by the Euro leaders’ “political will to give Greece a chance”. Picture: AP/Michel Euler Source: AP

Many Eurozone leaders could not hide their fury at being summoned to the emergency meeting and to hear the Greek delegation’s plan only to see their finance minister with nothing to table.

The pair has now been given to Thursday to get serious and come up with a reform plan. They are today expected to ask for a bridging loan until the end of the month ahead of an anticipated agreed plan.

On Sunday, the 28 leaders of the full European Union will meet to assess the final proposals for Greece that European Union President Donald Tusk described as “maybe the most critical moment in our history”.

Dutch Prime Minister Mark Rutte accused the Greeks of again playing games as their country goes to the brink.

“I’m very cheerless about this summit and I’m very cheerless about the fact whether Greece wants to come with proposals at all,” he said.

No new reform plans ... Greek Prime Minister Alexis Tsipras leaves the building after an emergency summit of eurozone heads of state or government in Brussels on Tuesday. Picture: AP/Michel Euler Source: AP

“The only solution is for Greece to make far reaching reforms and implement difficult measures. The fate of Greece in the euro and the responsibility is in Athens, not here. The Greek government is taking a large risk with the interests of the Greek people.”

The leaders from Lithuania, Belgium and Ireland also expressed disappointment and disgust by Greece’s attitude.

“With the Greek government it is every time manana,” Lithuania’s President Dalia Grybauskaite said using the Spanish word for tomorrow.

Belgian’s Prime Minister Charles Michel said: “We can’t do it with a gun to our head or a knife at our throats. A prime minister has to face up to his responsibilities.”

Tsakalotos said “progress” had been made at the summit despite the lack of a detailed document and he was buoyed by the Euro leaders’ “political will to give Greece a chance”.

He left the leader’s summit venue in the evening declaring: “My impression is that we are having a go to find an agreement soon.”

Peacekeeper ... President Barack Obama wants to see a solution to the Greek financial crisis. Picture: AP/Evan Vucci Source: AP

Like other leaders, German Chancellor Angela Merkel also remained unconvinced.

“We still do not have the basis for negotiations,” she said at the summit.

“It is not a question of weeks any more, but a question of a few days,” warned the leader of Europe’s biggest economy, who faces huge domestic pressure to be tough on Greece.”

Obama becomes middle man in Greek crisis

Obama rang and spoke with Greek Prime Minister Alexis Tsipras yesterday to enforce his desire for a resolution. He had earlier spoken with Merkel by phone urging her and her colleagues to find a solution.

“We continue to encourage all sides to participate constructively in those conversations,” White House spokesman Josh Earnest said, renewing calls for a deal between Athens and its creditors.

He added: “The leaders agreed it is in everyone’s interest to reach a durable agreement that will allow Greece to resume reforms, return to growth, and achieve debt sustainability within the eurozone. The leaders noted that their economics teams are monitoring the situation in Greece and remain in close contact.”

Meanwhile in Greece, the banks and the local stock exchange remained closed, a cap on withdrawals were still in place and liquidity remained critical.

Robert Peston asks whether Greece and the EU are now in for decades, rather than years, of sluggish growth.