BERLIN - Euro zone countries have decided in principle to help debt-stricken Greece, a senior German ruling coalition source said on Tuesday.

The decision on help for Greece has been taken in principle within the euro zone, said the source who has knowledge of the negotiations on Greece.

Various options were being considered and no decision had yet been taken but the most likely possibility was to offer Greece bilateral help, said the source who did not explicitly specify whether the aid would be financial in nature.

However, a spokesman for the German government said reports that the euro zone had made a decision to help Greece were unfounded.

Government spokesman Ulrich Wilhelm rejects as unfounded reports citing coalition sources saying a decision for aid for Greece has in effect been made, a government official quoted him as saying.

The Financial Times Deutschland had also reported that Germany was preparing an aid package for Greece. Citing coalition sources, the paper said bilateral aid as well as measures agreed at the European level were under consideration.

The paper also reported that finance minister Wolfgang Schaeuble would on Wednesday brief senior members of his conservative Christian Democrat (CDU) party on the details of the aid being considered.

If Greece received help, then it would only be under strict conditions and if the Greek government fundamentally reforms the state, the paper added, quoting senior CDU member Michael Meister as saying.

A stable euro is the top priority for conservatives, Meister told the paper.
A Finance Ministry spokesman, responding to media reports, also denied a decision had been reached.

No decision on aid has been taken. In preparation for the European Council, there is work going on with Greece to develop far-reaching reforms which will calm markets. Everything else is speculation, ministry spokesman Michael Offer said in a statement.

EU leaders meet on Thursday in Brussels and are likely to discuss Greece's difficult budgetary situation amid growing market concern that Athens may not be able to service its debts.

(Reporting by Matthias Sobolewski; Editing by Ron Askew)

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