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Greek PM Hints He Won't Pursue Further Austerity

by VOA News June 29, 2015

Greek Prime Minister Alexis Tsipras says he will respect the outcome of an upcoming referendum on his country's economic future if voters back a new round of European austerity measures that he opposes.

But Tsipras said his far-left government will not be the one to carry out those new reforms, which European creditors are demanding from Athens in exchange for billions of dollars in new bailout money.

Tsipras spoke late Monday on national television, as anti-austerity protesters marched in Athens and speculation grew that the government will formally default Tuesday on a $1.8 billion loan repayment due to the International Monetary Fund. A default would set the stage for a possible Greek exit from the 19-nation euro currency bloc.

In Paris, European Central Bank board member Benoit Coeure told the French financial daily Les Echos that a Greek exit from the eurozone 'can, unfortunately, not be excluded anymore.'

​​World markets tumbled Monday as the Greek public awakened to shuttered banks and sharp new limits on withdrawals from sidewalk cash machines. The Athens stock exchange, like the cash-strapped banks, is closed for six days until referendum results are tallied.

Stocks in Asia, Germany and France plunged 3 percent or more, while the New York Stock Exchange was down almost 2 percent near the end of trading.

​​Additionally, the Standard & Poor's financial services company cut Greece's credit rating further into 'junk' status. It also said there is a 50 percent chance the country will become the first to exit the eurozone in the 16-year history of the currency.

European Union chief executive Jean-Claude Juncker and British Prime Minister David Cameron both warned Monday that a Greek vote against austerity would mean that Greece wants to divorce itself politically from Europe.

'A 'no' [vote] would mean, regardless of the question posed, that Greece had said 'no' to Europe,' Juncker said in Brussels. Cameron said he would 'find it hard to see' how a negative vote 'is consistent with staying in the euro.'

Greece broke off negotiations with its creditors over the weekend and there was no sign of new talks. Tsipras then called on voters to reject more European austerity demands on July 5.

Across Athens early Monday, bank customers lined up outside banks to tap into their accounts at streetside ATMs, but they were limited to 60 euro ($68) daily withdrawals this week.

Pensioners lined up early at bank branches, hoping they would be able to access their funds through the cash machines, but they were not successful. The Finance Ministry said pensions were exempted from the new restrictions and said it would explain later how pension payments would be disbursed.

One Greek officer worker, Vicky Peraki, took a stoic view of the country's financial plight.

'We need to stay calm. We can live with less until the situation is resolved,' she said. 'Why should we panic? There's no reason for that. At some point all this will end.'

​​A U.S. State Department official said the American embassy in Greece is preparing to help U.S. citizens who may be in 'distress' in the country. The official estimated that about 100,000 Americans may be in the country, but said some may have dual citizenship.

Tsipras went on national television Sunday to announce the six-day bank closures and cash restrictions, hours after the European Central Bank, another Greek creditor, said it would not continue an emergency loan program that had allowed Greek banks to remain open in recent weeks.