(AP Photo/Michael Probst, File). Athens must repay billions of euros to the European Central Bank in the coming months.
Calling for a compromise, German Chancellor Angela Merkel warned that “if euro fails, Europe fails”.
Speaking to the BBC’s Radio 4 Today program, British Prime Minister David Cameron voiced his opinion that a “no” vote in the referendum could spell the end of Greece’s Euro membership.
In a related development, reports from neighboring Macedonia say the Skopje government on Sunday ordered its financial institutions to pull their money from Greek banks.
As the Two-Way reported Sunday, Greece looks all but certain to default Tuesday on its roughly $1.8 billion loan from the global Monetary Fund- a move that could see it leave the eurozone.
Yet perceptions could change if investors grow more anxious about the future of the currency union, including whether Greece can stay within the euro zone after default.
Britain is regarded as another safer haven and the euro also hit a 7-1/2-year low against sterling of 69.885 pence, but all of those moves were more muted in morning trade in Europe than they had been overnight in Asia. Brent crude, used to price global oils, shed $1.24 cents to $62.02 in London.
Greece is in desperate need of cash as banks and the stock exchange have been closed due to lack of funds.
The decision to impose capital controls came after a Bank of Greece recommendation, Tsipras said during a televised address.
Jonathan Hill, the Commission’s top official responsible for financial stability, added that the free movement of capital should be restored as quickly as possible and that the Commission would monitor the way any restrictions are imposed.
At a gas station in Athens on Monday, a sign read “Credit cards not accepted”.
The referendum will decide whether the country accepts creditors’ bailout conditions and secures its position in the union, or exits the Eurozone.
Pensioners wait outside a branch of the National Bank of Greece to get their pensions on June 29, 2026 in Athens. A failure by the Greek government to get more aid could lead to a determination that the Greek banks are no longer financially solid, since they have financial ties to the government. There is also a complete ban on transfers of money overseas, creating that the country’s economy will suffer a large blow due to restrictions on investment and spending.
The government’s existing bailout expires Tuesday, and as far as the Eurogroup (the bloc of eurozone finance ministers) is concerned, Greece can’t just choose to extend it for a week. He again asked for it to be extended by a few days to allow for the referendum.
As Greece hurtles toward an EU-IMF default and deeper turmoil after the weekend breakdown of debt talks with creditors, Merkel said that if the “capability to find compromises is lost, then Europe is lost”.
Asian shares also tumbled because of Greece and owing to unease over China’s economy, traders said.
While it is the sovereign right of Greece to hold the referendum, “what’s at stake is serious”, Mr Hollande told reporters in Paris Monday after an emergency session of ministers to discuss Greece.
The probable truth is that Syriza was never interested in negotiating with its creditors, he writes.
“It is now more than clear that this decision has no other aim than to blackmail the will of the Greek people and prevent the smooth democratic process of the referendum”, Tsipras said.
