Greece faces turmoil as IMF deadline looms

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Greek PM asks voters to reject bailout terms

© Dave Pinnell

The future of the Greek economy faces continued uncertainty after Prime Minster Alex Tspiras threatened to resign if citizens did not vote to reject EU-IMF proposals bailout.

“If the Greek people want to proceed with austerity plans in perpetuity, which will leave us unable to lift our head… we will respect it, but we will not be the ones to carry it out”, said Mr Tspiras.

Greek voters are due to vote for or against the U-IMF proposals in a referendum due to be held on July 5.
Greek government officials said on Tuesday that the country will be unable to repay a €1.6bn (£1.1bn) loan to the International Monetary Fund (IMF).

Speaking ahead of the 18:00 Washington time (22:00 GMT) deadline for the loan Mr Tspiras said “We ask you to reject [the proposals] with all the might of your soul, with the greatest margin possible”.

If the Greek government does fail to repay the loan then IMF Managing Director Christine Legarde will contact the lender’s board to confirm that Greece has defaulted on its debt.

Mr Tspiras’ comments follow a failed attempt by European Commission President Jean-Claude Juncker’s to reach an agreement late on Monday night.

Under the agreement proposed by Mr Juncker the Greek government would have needed to send a written acceptance of a deal before an emergency meeting of Eurozone finance ministers and to campaign for a Yes vote in the referendum. Mr Tspiras rejected the offer saying that it would have been a “humiliation”.

Commenting on the possibility of Greece defaulting on its debt leading it to leave the eurozone German Chancellor Angela Merkel said “euro fails, Europe fails”.

The Chancellor cautioned that Greece leaving the eurozone “would damage us in that we (Europe) would cease to be relevant in the world, that our unity disappears” and argued that European leaders needed “to promote again and again the ability to compromise and the principles in Europe”.

Talks are expected to continue until the deadline is reached.

For more on the Greek debt crises, go to ADVFN’s Greek Crisis page: http://uk.advfn.com/greece-crisis.

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