The Greek people have said ‘no’ to continuing austerity demanded by the county’s creditors and risks financial collapse if European leaders now turn their backs on a country that has voted itself out of the fold.
Over 60% of voters backed Alexis Tsipras’ Syriza party and rejected the latest proposals for spending cuts and tax increases against a backdrop of economic decline and the highest unemployment rate in Europe.
Tsipras claimed a ‘great victory’ and said his government will get back to the business of negotiating with Greece’s creditors on Monday morning.
German Chancellor Angela Merkel and other European leaders will need to decide whether they want rescue Greece and if so, on what terms but the loss of a Eurozone member will strike deep into the heart of the EU as it shows that nothing is permanent despite 15 years with a single currency.
A Greek exit from the Eurozone now is more likely than ever before. The the country is heading for financial collapse with banks running out of money and the government now without formal access to emergency funding, although the European Central Bank is meeting on Monday to discuss short-term financial aid.
Tsipras said he was confident of securing funds, if only to halt a humanitarian crisis. Earlier he called the austerity programme "blackmail" and "humiliation."
For European leaders the result is the worst possible outcome as the rejection of the austerity programme breaks the conditions for staying in the Eurozone and shows other bail-out countries such as Portugal that creditors can be snubbed using ‘the will of the people’ as the political tool.
The ‘no’ vote at least ends months of terse negotiations which only stopped when Tsipras called for a referendum a week ago. An official interior ministry projection this evening confirmed the 61% figure as being close to the expected final total.
Finance Minister Yanis Varoufakis is due to meet Greek bank bosses tonight to work out what to do when they reopen without any cash in a county that needs €50 billion in new funds to meet its current needs.
After five years of austerity the Greeks have decided to take on the country’s creditors in a desperate, high stakes game where the economic projections, should a further deal not be done, are of the worst sort imaginable in a country crippled by debt, unemployment, anger and misery.
