PARIS Greece was technically subject to a playpen last night after the government announced that Alexis Tsipras had no choice but to declare a bank holiday until July 7, two days after the planned referendum . Meanwhile, withdrawals will be limited and the stock closed today.
The decision to Alexis Tsipras, fueling fears of a black Monday in the markets today, came after the European Central Bank decided yesterday not to extend the amount of the credit line in progress, which rises to 98,000 million euros, but that was already almost fully utilized.
The dramatic decision to introduce capital controls in the country is the result of weeks of tense negotiations and clashes between the Greek government and its institutional creditors (the European Central Bank, the European Commission and the IMF), culminating 48 hours ago, when Tsipras announced its intention to submit demands these institutions to the popular vote.
Outraged, the finance ministers of the eurozone, who mediated in the negotiations, unilaterally decided yesterday to end any possibility of extension of the current bailout. The ECB, for its part, did the same thing.
After an emergency meeting, the governing council of the ECB said that the institution will not provide additional funding vital to Greece and stressed their willingness to continue working with the Central Bank of Greece “to maintain financial stability.”
“Following the decision of the Greek authorities to hold a referendum and not to prolong the adjustment program of the European Union (EU) for that country, the governing council says it will work closely with the Central Bank of Greece to maintain financial stability, “the statement said.
It also adds that the ECB” is ready to reconsider its decision, “thereby which leaves the door open for any change in attitude ultra-left government of Alexis Tsipras.
Greek banks depend on these funds from European emergency since last February, when the central banks of the other 18 countries Eurozone cut off their access to regular loans.
A total of 89.000 million were then approved, under the ELA (Emergency Liquidity Assistance) program, the governing council of the ECB, composed of the presidents of the central banks of the euro zone, six senior officials of the institution chaired by the Italian Mario Draghi. Approval of two thirds of the board to any application for ELA is agreed
is required. Until yesterday, every dollar that came from a distributor of Greek airline was backed by emergency funding from the ECB. Billions of euros have left the country’s banking system in recent weeks as the relationship between Athens and its international creditors deteriorated
Under these conditions, the Greek authorities had only two options. Decree a bank holiday or implement capital controls. They decided to do everything at once, as happened in Argentina in 2001.
In a brief televised address to the nation, Tsipras blamed the situation to the leaders of the 18 other eurozone countries, but not He gives details on the extent of the bank holiday or the amount of money that could be withdrawn from ATMs. After it emerged that no banking until the day of the referendum and that distributors only deliver a maximum of 60 euros. The measures do not affect foreign tourists, who can continue to draw money from ATMs.
For Tsipras, the finance ministers of the eurozone “has been denied to the Greek people the right to decide democratically . “
Adding confusion to the drama, the European Commission said yesterday for the first time since the crisis began, the last plan of creditors offered to Greece numerous awards and a reduction in debt: that was just Tsipras main demand during these five months of dialogue of the deaf. But that plan was never presented because of the breakdown of negotiations last Saturday.
These alleged concessions came too late to prevent chaos in Greece, a situation that made fear a black Monday today in markets and even caused serious concern across the Atlantic.
US President Barack Obama, have called German Chancellor Angela Merkel, asking him to take some initiative. Jack Lew, the Treasury secretary, called in turn to Greece’s creditors to alleviate the debt burden.
The heads of state and European government will maintain last emergency summit tomorrow. According to diplomatic sources, henceforth would Francois Hollande who would assume the conduct of future negotiations with Athens. During these five months of negotiation, the French president maintained a more understanding attitude with Athens as the rest of the leaders of the euro area.
In any case, although it was the ECB decision that precipitated the outcome of the crisis, some European diplomats acknowledged yesterday that Eurogroup members were willing to use all means at its disposal to crush the “uncontrollable” Greek Prime Minister.
“The decision of the ECB may read in that context, “said a French diplomat. “It’s a way of telling the electorate, before the referendum,” Look what awaits you if you say no to Europe ‘, “said
At the heart of a European Union (EU) formatted and bureaucratic. where respect for the rules is sacred, the emergence of Tsipras and Syriza, the party anti-establishment, embodied, the specter of disorder that European leaders looked far from a distance and condescension.
“If there is set the limits now, we will set a precedent and will be impossible to back. In addition to Syriza, we must fight can, “says a sympathetic Spanish diplomatic Popular Party.
Yesterday, Wolfgang Schauble, Minister German Finance said he was “perplexed and depressed” by recent events. The leader of the hardliners, who led the resistance against Tsipras, seems to have realized he was playing with fire and that his intransigence could drag down Europe and the world economy. .
No comments:
Post a Comment