The European Union and Greece hope to reach a deal on the crisis-hit country's debt mountain by the end of the year, EU economic affairs chief Pierre Moscovici said on Monday.

"We need to reach a positive agreement involving the IMF by the end of the year," Moscovici told reporters after meetings with Greek Prime Minister Alexis Tsipras and Finance Minister Euclid Tsakalotos.

But the Frenchman stressed that any agreement would have to include the International Monetary Fund, which has so far refused to commit itself to the bailout Greece signed with the EU last year.

"It is in the interest of all parties that the IMF is fully on board," Moscovici said, noting that the global lender brought "credibility and visibility" to the rescue.

The IMF has said it won't give a penny to the latest bailout -- Greece's third since 2010 -- until it sees a concrete plan from the Europeans to cut substantially Greece's massive debt burden.

The IMF and EU creditors disagree on just how much Athens can improve its finances through ongoing reforms.

Europe insists that Greece will be able to achieve a 3.5 percent primary budget surplus, which excludes debt servicing, within a few years but the IMF says a 1.5 percent surplus is the best that can be expected.

Moscovici on Monday said "complacency" could delay or negate the benefit of the reforms.

An upcoming review of the Greek bailout in the autumn will include bad bank loans and a labour relations overhaul likely to cause social unrest.

"We need to enter a new phase of cooperation and trust...there must be coherence on what has been decided," Moscovici said.

Greece's economy is expected to exit recession after the second half of 2016, he said.

Source: AFP