Greece votes No in bailout referendum

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Greek "No" campaign

Greeks have overwhelmingly rejected creditors’ demands for more austerity in return for rescue loans in a critical referendum.

They backed Prime Minister Alexis Tsipras, who insisted the vote would give him a stronger hand to reach a better deal.

Mr Tsipras gambled the future of his five-month-old left-wing government on the vote. The opposition accused him of jeopardising the country’s membership in the 19-nation club that uses the euro and said a “yes” vote was about keeping the common currency.

With 70% of the votes counted, the “no” side had more than 60%. The interior ministry predicted that margin would hold.

Finance Minister Yanis Varoufakis said that creditors planned from the start to shut down banks to humiliate Greeks and force them to make a statement of contrition for showing that debt and loans are unsustainable.

Couple celebrating the referendum vot

Today, “the Greek people said ’no more’ to five years of austerity”, he said.

Thousands of government supporters gathered in central Athens in celebration, waving Greek flags and chanting “No, No, No.”

Governing left-wing Syriza party Euro deputy Dimitris Papadimoulis said that “Greek people are proving they want to remain in Europe” as equal members “and not as a debt colony”. The referendum was Greece’s first in 41 years.

Minister of State Nikos Papas, speaking on Alpha television, said it would be “wrong to link a ’no’ result to an exit from the eurozone. If a ’no’ prevails that will help us get a better agreement.”

Mr Tsipras’ high-stakes brinkmanship with lenders from the eurozone countries and the International Monetary Fund resulted in Greece defaulting on its debts this week and shutting down its banks to avoid their collapse. He called the referendum last weekend, giving both sides just a week to campaign.

Belgian Finance Minister Johan Van Overtveldt was one of the first eurozone ministers to react to the initial results.

“This likely ’no’ complicates matters,” he told Belgium’s VRT network, but insisted the door remained open to resume talks with the Greek government within hours.

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Poland’s prime minister said that if final results in Greece’s bailout referendum are confirmed as “no,” she believes that Greece will have no choice but to leave the eurozone.

Ewa Kopacz said a “no” victory meabs “the path of Greece can be only one: leaving the eurozone”.

The vote was held amid banking restrictions imposed last Monday to halt a bank run, with Greeks queuing up at ATMs across the country to withdraw a maximum 60 euros per day. Banks have been shut all week, and it is uncertain when they will reopen. Large lines once again formed at ATMs today.

Greece is no longer in a bailout programme since its previous package expired last Tuesday. It now has to negotiate a new one with its creditors that involves even more money for the government and banks and new economic austerity measures.

Despite the Greek government’s assertion that a “no” vote will not lead to a euro exit, most experts agree it would open up more uncertain financial outcomes.

A number of European politicians, including Jeroen Dijsselbloem, the top eurozone official, have said a “no” vote would jeopardise Greece’s place in the eurozone. Investors are also likely to believe a “no” win increases the chance of a so-called “Grexit,” where Greece returns to its own old currency.

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