Greece in limbo as Europe awaits vote

Townsville Bulletin - - NEWS - ELENA BE­CA­TOROS and DEREK GATOPOULOS

GREECE braced for more chaos on the streets out­side its mostly shut­tered banks yesterday, as Athens and its cred­i­tors halted talks on re­solv­ing the coun­try’s deep­en­ing fi­nan­cial cri­sis un­til a ref­er­en­dum this week­end.

Banks have been closed all week, although a few have been re­opened to help pen­sion­ers with­out ATM cards.

The Euro­pean Cen­tral Bank left the terms of its emer­gency $ 100 bil­lion cash sup­port to Greece un­changed, a day af­ter Athens slipped into ar­rears with the In­ter­na­tional Mon­e­tary Fund and its bailout pro­gram ex­pired.

The move kept chances alive for a set­tle­ment be­tween Greece and cred­i­tors. And Fi­nance Min­is­ter Yanis Varoufakis pub­licly thanked the ECB and its pres­i­dent, Mario Draghi, for the de­ci­sion.

“This al­lows us to breathe. It’s a very pos­i­tive move and a move of good will on the part of the Euro­pean Cen­tral Bank. I welcome it,” Mr Varoufakis said.

Mr Draghi, he said, had faced down “hawks” among eu­ro­zone mem­bers who had de­manded that Athens in­crease col­lat­eral needed to re­ceive con­tin­ued as­sis­tance.

Asian stock mar­kets ad­vanced af­ter gains on Wall Street as strong US pay­roll data over­shad­owed wor­ries about the Greek cri­sis.

Greece is seek­ing a third bailout from the eu­ro­zone res­cue fund af­ter the pre­vi­ous deal ex­pired this week with­out agree­ment on the terms of fi­nal pay­outs.

The im­passe left bil­lions in bailout money frozen or can­celled and saw Greece forced to close banks and its stock mar­ket for at least a week while the coun­try’s left- wing gov­ern­ment called a ref­er­en­dum urg­ing vot­ers to de­nounce the deal of­fered by cred­i­tors.

Eu­ro­zone fi­nance min­is­ters de­cided to put the talks with Greece on hold un­til the vote.

“Given the po­lit­i­cal sit­u­a­tion, the rejection of pre­vi­ous pro­pos­als, the ref­er­en­dum which will take place on Sun­day, and the rec­om­men­da­tion by the Greek Gov­ern­ment to vote ‘ No,’ we see no grounds for fur­ther talks at this point,” Dutch For­eign Min­is­ter and eurogroup chair­man Jeroen Di­js­sel­bloem said.

In Athens, crowds of anx­ious el­derly Greeks thronged banks on Wed­nes­day be­gin­ning be­fore dawn, strug­gling to with­draw their max­i­mum of 120 eu­ros ($ 134) for the week af­ter the Gov­ern­ment re­opened some banks to help pen­sion­ers whoh d don’t’ t have bank cards.

“It’s very bad,” said re­tired phar­macy worker Popi Stavrakaki, 68. “I’m afraid it will be worse soon. I have no idea why this is hap­pen­ing.”

Busi­ness as­so­ci­a­tions and the coun­try’s largest labour union urged the Gov­ern­ment to can­cel the vote.

And the Coun­cil of Europe – an in­de­pen­dent body that mon­i­tors elec­tions and hu­man rights – said the ref­er­en­dum would fall short of in­ter­na­tional stan­dards.

In a sign of se­ri­ous fi­nan­cial de­te­ri­o­ra­tion, Greece suf­fered another sov­er­eign down­grade, the fourth this week, as Moody’s slashed the coun­try’s rat­ing from Caa2 to Caa3, or just above de­fault.

Ger­man Chan­cel­lor An­gela Merkel said a deal re­mained im­pos­si­ble be­fore the ref­er­en­dum, while French Pres­i­dent Fran­cois Hol­lande said cred­i­tors should seek an ac­cord be­fore then.

“We have to be clear. An ac­cord is for right now, it will not be put off,” Mr Hol­lande said.

Pic­ture: MI­LOS BI­CAN­SKI/ GETTY IMAGE­SES

ON THE BRINK: Pen­sion­ers line up out­side a Na­tional Bank branch in Athens, Greece, hop­ing to be able to with­draw a small amount t of cash; ( inset) Greek Prime Min­is­ter Alex Tsipras.

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