Tue | Sep 25, 2018

Future in limbo as creditors reject aid extension

Published:Saturday | June 27, 2015 | 11:07 PM
Greece's Prime Minister Alexis Tsipras attends an emergency Parliament session for the government’s proposed referendum in Athens yesterday.

BRUSSELS (AP) - Greece's place in the euro currency bloc looked increasingly shaky yesterday after eurozone nations rejected a month long extension to its bailout program and the prime minister called for a risky popular vote on the country's financial future.

Worried Greeks queued outside banks for cash amid the uncertainty, with eurozone finance ministers deciding to hold a meeting without Greece to assess how to keep the euro currency union stable in the face of heightened risks that Greece could drop out.

Prime Minister Alexis Tsipras shocked Greece's creditors late last Friday when he called for a referendum in a week on whether to accept the reforms that the rescue lenders want in return for more financial aid.

The country's bailout program ends Tuesday. Without an extension or more loans from creditors, Greece is likely to be in arrears on a debt payment Tuesday and its banks face the risk of collapse.

The Greek government's call on the people to vote against a proposed bailout deal from international creditors on July 5 angered many of its eurozone partners.

The governing council of the European Central Banks, which is keeping Greek banks propped up, said it would hold a meeting "in due course" on the situation and said it was "closely monitoring developments."

Greek Finance Minister Yanis Varoufakis insisted that Athens and lenders still had time to improve the deal -- and avoid a negative outcome to the referendum. "There is no reason why we can't have a deal by Tuesday. If the deal is acceptable we will recommend a positive vote," he said.

The sides are haggling over the reforms the country needs to make in exchange for more financial aid but have managed to only increase uncertainty over the country's future.