German MPs have approved a hard-won bailout extension for Greece in a move Germany's finance chief called "not easy" but necessary, lifting the last hurdle to keeping a crucial lifeline open to Athens.
Greece's left-wing Prime Minister Alexis Tsipras welcomed the German vote as "a political act of common sense and democracy", pledged to get to work on reforms, and suggested it was a victory for his anti-austerity cause.
The four-month bailout extension for Greece, approved by eurozone finance ministers on Tuesday, averts a potentially calamitous end-February deadline that could have seen Athens default and exit from the euro.
With worsening Greek economic data heightening the pressure, German Finance Minister Wolfgang Schaeuble had vigorously urged MPs to support giving Athens the additional breathing space.
"I'd like to ask parliament, each lawmaker, not to reject the request by the ministry of finance, which wasn't easy for me either, because this would do great harm to our people and our future," Schaeuble told parliament.
Schaeuble, who has traded barbs with Athens in recent weeks, sought to reassure MPs Germany would not have to stump up "new billions" or change the bailout conditions but merely grant "more time to successfully conclude" the plan adopted for Athens in 2012.
As expected, the extension won overwhelming support in the lower house where Chancellor Angela Merkel's left-right coalition has a commanding majority.
While Schaeuble described the extension as an act of "solidarity" toward an EU member in need, Tsipras said that "Europe has now recognised that Greece has turned a new page".
The new Greek government has walked a fine line between pledging to meet the demands of international creditors and maintaining the support of voters who swept them to power on promises of ending years of hated austerity.
An anti-government protest in Athens, following the deal on Tuesday with eurozone ministers for the bailout extensions, deteriorated into street violence on Thursday.
In another protest Friday evening, around 8,000 people demonstrated outside parliament at a rally organised by the KKE communist party, police said, as Tsipras chaired a cabinet meeting inside.
On Friday the government faced more bad news when official data showed Greece's economy shrank by 0.4 per cent in the fourth quarter of 2014, more than previously thought, and the first quarter-on-quarter contraction since the country exited a six-year recession last year.
With a more than 1.5 billion euros ($A2.16 billion) repayment to the International Monetary Fund looming in March, Finance Minister Yanis Varoufakis acknowledged that "at this moment the coffers are empty".
Greece's debt of 320 billion euros is equivalent to 175 per cent of its annual economic output.
