The International Monetary Fund has confirmed a Greek debt deal has been reached with eurozone leaders.
The IMF's managing director Christine Lagarde says the new 2020 target will be for Greece's debt to fall to 124 per cent of its gross domestic product, with a further reduction to 110 per cent two years later.
She says the agreement will include the buyback of some Greek debt and other immediate measures to cut the country's debt by 20 per cent of GDP.
"The initiatives include Greek debt buybacks, return of Securities Market Programme (SMP) profits to Greece, reduction of Greek Loan Facility (GLF) interest rates, significant extension of GLF and European Financial Stability Facility (EFSF) maturities, and the deferral of EFSF interest rate payments," the IMF managing director said in a statement.
Christine Lagarde says once European leaders start acting on today's agreement, the IMF should be able to release its share of the next tranche of financial assistance to Greece.
"Once progress has been made on specifying and delivering on the commitments made today, in particular implementation of the debt buybacks, I would be in a position to recommend to the IMF Executive Board the completion of the first review of Greeceâs program," she added.
The deal means Greece can to unlock up to $54.1 billion in financial aid from next month.
Eurogroup president Jean-Claude Juncker says it was "very difficult" to reach an agreement, after three marathon sessions of talks in three weeks.
"Let me first say that this is not just about money, this is the promise of a better future for the Greek people and for the euro area as a whole, a break from the era of missed targets and loose implementation." Greece's debt is currently forecast to peak at just under 200 per cent of GDP over the next two years.