GREEK FI­NAN­CIAL CRI­SIS: WHAT HAP­PENS NOW

Townsville Bulletin - - FRONT PAGE - CHARLES MI­RANDA

TO a ca­coph­ony of car horns, spon­ta­neous singing and the fran­tic wav­ing of na­tional flags, Greeks have re­sound­ingly said “No” to the terms of an in­ter­na­tional bailout.

At Syn­tagma Square, Athens, thou­sands cel­e­brated the ref­er­en­dum vote, which an­a­lysts be­lieve may lead Greece to aban­don the euro cur­rency and leave the EU.

Leav­ing the euro would have a pro­found ef­fect on world mar­kets and in­crease fears the EU is un­rav­el­ling.

“No” se­cured 61.3 per cent of the vote and the re­sult caused panic in Ger­many, Greece’s largest cred­i­tor. Its cen­tral bank warned bil­lions of euros could be wiped off its bud­get and fur­thered fears Europe’s make- up could be ir­repara­bly dam­aged if the Grexit hap­pens.

The euro fell 1.6 per cent to $ US1.0963 in elec­tronic trad­ing be­fore Asian mar­kets opened, with Euro­pean mar­kets also down. The Aus­tralian dol­lar also suf­fered from the flight to the safety of the green­back, slid­ing to a sixyear low of US74.52c.

It was a high- stakes gamble for Prime Min­is­ter Alexis Tsipras and his left­ist Syriza Party, as he threat­ened to step down and force new elec­tions if the coun­try voted “Yes”. But in­stead he won a man­date to re­launch de­mands for fur­ther multi­bil­lion- euro aid pack­ages even though the In­ter­na­tional Mone­tary Fund has re­jected that no­tion and there ap­pears to be no ba­sis for the Euro­pean Cen­tral Bank to lend more.

“Given the un­favourable con­di­tions, you have made a very brave choice,” he told the Greek peo­ple via tele­vi­sion.

There is no clear path to fur­ther Euro­pean aid, with many sim­ply see­ing the re­sult as an end to aus­ter­ity and be­ing an­swer­able to the “de­mands” of EU cred­i­tors.

Cel­e­bra­tions in Syn­tagma Square, which faces the Greek par­lia­ment, be­gan shortly af­ter 9pm lo­cal time as the “No” vote surged ahead in what had been ex­pected to be a close- run thing.

“We are free,” one woman

chanted as oth­ers linked arms, danced and sang. Oth­ers chanted “Oxi, oxi” (“No, no”) over and over, with food and flag stalls adding to the car­ni­val at­mos­phere.

Tsipras de­clared the win a clear man­date for new Greek re­quests for help as early as to­day from Europe, with less strin­gent con­di­tions at­tached.

Ger­man Chan­cel­lor An­gela Merkel, who has ac­cused Mr Tsipras of driv­ing his na­tion “into the wall”, was meet­ing French coun­ter­part Fran­cois Hol­lande in Paris yes­ter­day to dis­cuss the re­sult and call for a spe­cial eu­ro­zone sum­mit to­day.

The ECB will also hold an emer­gency meet­ing to look at likely sce­nar­ios, with Greek banks al­ready re­quest­ing emer­gency funds.

Likely to be dis­cussed was Mr Tsipras’s call for the IMF, ECB and Euro­pean Com­mis- sion to wipe 30 per cent off the € 240 bil­lion ($ 353 bil­lion) they have loaned Greece over the past five years and al­low it a 20- year grace pe­riod be­fore it starts re­pay­ing the rest.

Ger­many’s Econ­omy Min­is­ter Sig­mar Gabriel said it was hard to imag­ine new bailout dis­cus­sions with a coun­try that re­jected bailout terms.

“Tsipras and his Govern­ment are lead­ing the Greek peo­ple on a path of bit­ter aban­don­ment and hope­less­ness,” he said, adding the PM had “torn down the last bridges on which Greece and Europe could have moved to­wards a com­pro­mise”.

Greece’s Fi­nance Min­is­ter, dual Greek- Aus­tralian na­tional Ya­nis Varo­ufakis, will play no fur­ther part in any ne­go­ti­a­tions af­ter re­sign­ing yes­ter­day.

“Soon af­ter the an­nounce­ment of the ref­er­en­dum re- sults, I was made aware of a cer­tain pref­er­ence by some Eurogroup par­tic­i­pants, and as­sorted ‘ part­ners’, for my ... ‘ ab­sence’ from its meet­ings,” Varo­ufakis said on his blog.

It was “an idea that the Prime Min­is­ter judged to be po­ten­tially help­ful to him in reach­ing an agree­ment”.

Out­spo­ken and flam­boy­ant Varo­ufakis, added: “I shall wear the cred­i­tors’ loathing with pride.”

PRIME MOVER: Prime Min­is­ter Alexis Tsipras ( inset) speak­ing to the me­dia af­ter cast­ing his vote on the aus­ter­ity mea­sures, and flag- wav­ing sup­port­ers of the ‘‘ No’’ vote cel­e­brat­ing in Athens ( main).

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