The utility Greece is not extended, it was announced yesterday. Thus the eurozone enters unknown territory. Today is another important day. The European Central Bank (ECB) has decided this afternoon to the emergency liquidity assistance to maintain in Greek banks. With this emergency instrument the money is in the banks again cleared. However, the aid is not increased, which means that Greek banks tomorrow probably will not open.
Updates from Laura Klompenhouwer
Cabinet meeting
The Greek government will at 19:00 together, reports the Greek state television. Meanwhile Varoufakis Minister of Finance and chairman Yannis Stournaras Greek central bank already come together at the Ministry of Finance. There stood as Landon Thomas Jr. the New York Times a number of concerned citizens.
Lagarde makes itself heard
Christine Lagarde, managing director of the International Monetary Fund, says she is disappointed with the failure of the negotiations with Greece. Economic stability can only be restored if there is “structural and fiscal reforms” come, she repeated yet again. These reforms should be supported by the right kind of funding and measures to make sustainable debt.
“The IMF stands ready to work this approach further with the Greek authorities and our European partners “
(Reuters)
Fair Athens / star is middle finger
The Athens Stock Exchange closed tomorrow remains possible, Stelios Bouras reports of eg Wall Street Journal
Meanwhile
… Greek star on the blue European flag has become middle
… can our correspondent Marloes de Koning no working ATM find more:.
Referendum Question, translated
Bloomberg has published the question where Greeks have to consider next week in a referendum. We have translated him:
“The Greeks are hereby requested to decide whether to accept a draft agreement, which was submitted by the European Commission, the European Central Bank and the International Monetary Fund, at the meeting of the Eurogroup June 25, which consists of two documents.
The first document is called “Reforms for the completion of the current program and then ‘and the second document called” Preliminary analysis of debt sustainability’
Those citizens who reject the proposal of the institutions, vote ‘disagree / NO’
citizens who accept the proposal, vote ‘agreement / YES “
Ajar
The French commissioner Pierre Moscovici (Economic and Financial Affairs), stressed that the door for Greece remains open
Answer the question: what question
Many Greeks support the referendum, but admitted to having no idea where they will soon have to carry their voice out. The question was: what question is asked the people? Bloomberg has the answer:
“Greeks are asked at this to decide whether a draft agreement document accepting submitted by the European Commission, the European Central Bank and the International Monetary Fund during the Eurogroup meeting June 25th. ”
These are two documents; on a reform and another on debt. People may once voting, in which they reject the proposal of the troika then approve.
Heavy Responsibility
Persco Juncker
The President of the European Commission, Jean-Claude Juncker, hold a press conference tomorrow afternoon in Brussels. Presumably that deal with the proposal that the European Commission has just put online (pdf).
Game not played yet
The European Commission has just published the proposal which was on the table when the Greek government decided to hold a referendum. From the statement:
“Discussions on this text were ongoing with the Greek Authorities on Friday night in view of the Euro Group of 27 June 2015. The understanding of all parties Involved was thatthis Eurogroup meeting shouldering Achieve a comprehensive deal for Greece, One That would have included not just the Measures to be Jointly agreed, but would alsohave Addressed future financing needs and the sustainability of the Greek debt. It ook included support for a Commission- LED package for a new start for jobs and growth in Greece, boosting recovery of and investment in the real economy, in-which was be discussed and endorsed by the College of Commissioners on Wednesday 24 June 2015. “
Read the whole document
Blog Varoufakis
The Greek Minister of Finance faith Varoufakis a blog in which he expounds his views. After the euro group meeting yesterday, he writes that it will not in European history as a “moment to be proud of.”
“Ministers being requested by the Greek authorities off to the Greek people to give a week to ‘yes’ or’ no say on the proposals of the institutions – proposals that are crucial for the future of Greece in the euro zone. The whole idea that a government would consult the people about a problematic proposal [...] was with incomprehension and contempt bordering received contempt. “
It was a bad day for democracy continues Varoufakis. After the Greek request for more time was turned down in favor of the referendum, the Eurogroup sent the minister without his consent in a statement.
“Can democracy and monetary union next existence or should one of the two to be sacrificed? This is the key question which the Eurogroup has responded by placing democracy in the ‘too hard’. “
Banks empty
This was yesterday
This
today:
Greeks in great uncertainty
In many ATMs in Greece is not money more. Everyone is still trying to pin today. Many people assume that until the referendum – scheduled for next week – no money can absorb more, our correspondent says spot Marloes de Koning
“. At the banks where there is money, are long lines. People would rather be safe than sorry. The supermarkets are closed today, so people can not just hoard.
The atmosphere is confused. People do not know where they have to vote on it. They see something coming towards them which they have no control over. Many people I talk to say that it is good that the public is consulted, because it involves such major issues, so much impact for everyone . At the same time they recognize that it is too complex they say. “I’m not where I should vote” And that many people simply unclear People listen to every word
… is always difficult: 36 percent of those who voted, has SYRIZA [the ruling party of Prime Minister Tsipras, ed.] vote. That is not the majority of the population, but Syriza is the largest party. Many people are disappointed. They think of ‘God, how are we still ended up in this situation?’ “
“Of course I vote later no”
The Greek parliament last night approved the plan to hold a referendum on the bailout plan for the country. The referendum must be held on 5 July. Our correspondent Marloes de Koning gauge the mood in Athens. “We are Greeks, we have dignity. We have brought to light and that we will do again. Democracy will start here again. Whether you like it or not. “Of course she will soon vote ‘no’, she growls before they cross the street with her shopping trolley. Read the entire report.
Banks close
Greece can not avoid the closing of the banks. This is the logical consequence of the decision by the ECB to do maintain liquidity support to Greek banks via the Greek central bank, but not increase.
If banks still would open, would lead an immediate shortage of money, and possibly a bank run and the associated panic.
Maarten Schinkel explains:
The Greek government bonds that are now on the balance sheet of the ECB, walk 20 July. That needs to be repaid. If Greece there is not capable, it remains officially in default – a so-called default
The risk that banks so. last long – 3 weeks close – is small, said Schinkel. Wait until July 20 seems unrealistic.
Good news ? Well, not really
The decision just means that the European Central Bank Greece does not come to the rescue with an increase in financial support to banks. That liquidity support to Greek banks is maintained at the level of last Friday (89 billion euros) and is not raised, probably means that Greek banks tomorrow can not open and / or capital controls should be set.
Read the full news article economics editor Maarten Schinkel.
Decision ECB
The European Central Bank has just announced that the liquidity support provided by the Bank of Greece to the Greek banks (so-called emergency liquidity assistance) remains at the same level.
Gloomy politicians (part 3)
” These are dark times for Greece ” said Finance Minister Varoufakis in the BBC’s The World this Week. Asked whether Greece Tuesday repay 1.6 billion euros to the International Monetary Fund, he pointed out Greece in principle entitled to a portion of the interest income on government loans on the balance sheet of the European Central Bank. According Varoufakis this 1.9 billion. This would reduce the IMF requirement can be met.
Capital controls ? ‘No’
The Greek Government does not think to set capital controls, as Finance Minister Varoufakis just reported on Twitter. News agencies reported earlier yet it Varoufakis told the BBC that the government capital controls (such as a limit of what you can record, or may transfer to foreign countries) and the shut banks are considering tomorrow.
Meanwhile, also Germany adapted the advice. Travellers are advised to contact enough money to take them to Greece. It further warned of long lines and possible cash shortages at ATMs. Some ATMs are empty, others were still refilled.
G7 call
The G7 major industrialized economies (Germany, France, Italy, UK, Japan, USA, Canada) talking today about the situation, the German daily reported Handelsblatt . The interview takes place at the level of deputy ministers and deputy ministers, not between governments. According economics editor Mark Beunderman this shows that reflection on the international economic consequences of the stalemate.
Council for Stability
The Greek ‘council financial stability “comes today at 17.00 local time (16.00 hours Dutch time) together. In the board are, among others, the Greek Finance Minister Yanis Varoufakis, his deputy minister Dimitris Mardas, the president of the Bank of Greece Yiannis Stournaras, head of the Association of Greek banks and the head of the committee of financial markets in Greece. Reported Reuters.
The IMF
It was last week the International Monetary Fund – part of the troika, where the European Central Bank (ECB) and European Commission belong to – which indicated that the Greek proposals were too focused on tax increase and not enough on spending cuts. Athens Tuesday must repay 1.6 billion euros to the IMF, and the IMF wants “at all costs” back, says economics editor Maarten Schinkel. “The IMF is a reputational risk. The IMF is always repaid and wants now.”
The Greek prime minister Tsipras tonight said that the insistence of creditors that the IMF would be involved in the bailout , has made it more difficult to reach an agreement on the aid package.
In Focus
It is now awaiting the outcome of the meeting of the ECB board, which would begin at 12.00. Greeks await the decision in tension. For ATMs in the country arose this morning rows.
Photo EPA / Simela Pantzartzi
National Bank in Athens. Photo Reuters / Marko Djurica
The National Bank. Photo Reuters / Marko Djurica
Photo Reuters / Marko Djurica
Photo Reuters / Marko Djurica
Poll Dog
Nearly 60 percent of the Dutch have sympathy with the Greeks because of the situation there. This is evident from the weekly poll by Maurice de Hond. Still, about 45 percent of respondents to a Grexit and 38 percent are against it. Most respondents (54 percent) believe that Greece most to blame for the situation. Two-thirds are against cancellation of a large part of the Greek debt. More than 80 percent expect the money Netherlands has borrowed from the Greeks only a small part or nothing back.
Gloomy politicians (part 2)
The French Prime Minister Manuel Valls thinks that the ECB can not possibly stop the (indirect) emergency support to Greek banks.
“The European Central Bank is independent, but [...] I do not think they can pull it drip out,” he said, according to AFP news agency across several French media . “It is the Greek people that suffers. Let’s not make their suffering worse.”
But he sees the scenario of a Grexit as well as realistic, as the Greeks next week in a planned referendum rejected the financial bailout creditors (ECB, IMF and European Commission). He called on the Greek government to get back around the negotiating table.
Gloomy Politicians (Part 1)
The Austrian Finance Minister Hans Jorg Schelling sees bleak. “Greece alone is responsible for the collapse of the negotiations,” he told the newspaper Die Presse .
An exit from the euro zone is possible, but only if Athens submits an official request to leave the European Union, Schelling said. Leaving the eurozone without first leaving the EU is not legally possible, say economics editors Mark Beunderman and Maarten Schinkel:
“European Union membership results, according to the treaty the introduction of the euro as a country has met the requirements. But there are countries that have negotiated an exception in the introduction of the Maastricht Treaty, namely United Kingdom and Denmark. They have a so-called opt-out . “
advice
The travel advice for Greece has changed, we reported earlier in this live blog. Foreign Affairs recommends to carry cash for the entire trip. It is further recommended that an insurance policy. Read the advice here.
Implications stop ELA
If the ELA – the supply of money to Greek banks and at the risk of the Greek central bank – will stop put, Greek commercial banks have no more money, says NRC commentator and economics editor Maarten Schinkel. “They have to close.” It works like this:
“The Greek citizen gets money from his account via ELA is the money from the banks again discharged at the time of this stop put the banks.. no money to pay, then the monetary system means Greece functioning Dan is still the question of whether the system as desist, or not at all if the banks remain closed for a day -… a so-called bench holiday – there is a kind of panic breaks out “
What the consequences would be is unknown.. The consequences of stopping the ELA would be for the euro, is also uncertain. Schinkel:
“The decision that determines whether Greece is entering a deep crisis lies with the ECB, which is crazy, because it’s a very political decision, while the ECB. the connected central banks technocratic institutions.
It is said that the European system a Greek default now best handle it. That could be so. But we must take into account unknown unkown the things we do not know we do not know. You can not predict all the effects. It could just be that the government bonds in Portugal suddenly would come under pressure. “
86 billion risk
Emergency Aid in the form of ELA is paid by the Bank of Greece but the ECB, in which all the central banks of the euro zone are united, in the case of a Grexit, a Greek euro exit losing some 86 billion granted in the form of liquidity support for Greek banks. The aid, which since early this year was granted, was a response to capital flight from Greece, which accelerated as the uncertainty increased.
advice changed
The Ministry of Foreign Affairs has changed its travel advice for Greece.
BBC: ECB considers ending emergency support
The European Central Bank would consider the ELA (emergency liquidity assistance) to stop put. That the BBC reports on a “well-informed sources”. Other media have not been able to confirm this report based on its own sources and other journalists doubts whether it is true that the ELA would stop put a whole. At most, the ECB would lower the height of the ELA amount, some say.
It is difficult to ECB Decisions for many journalists the institutions that do not “officially” announcing says our economics editor Mark Beunderman. The ECB allows the news mostly from sources to leak.
Yesterday, summarized
After the fifth meeting of the Eurogroup (finance ministers of the euro area) in one week was over, turned the chances of an agreement on Greece this weekend – and probably before the deadline of next Tuesday – misjudged . The main events of yesterday at a glance:
- The Greek Government to solve the proposal of the Eurogroup to the debt issue, denied, and neither will first hold a referendum, as was last night . Then stopped the negotiations after five months of discussion in all possible combinations.
- From the cessation of negotiations followed that the aid program is not extended to Greece. The lenders do not make money anymore. And while the almost bankrupt Greece Tuesday 1.6 billion must repay the IMF.
- The aid program of the euro countries themselves (European Stability Mechanism) and the European Central Bank (ECB) may borrow still money Greece. The ECB is talking about noon during a videoconference on the ELA, the emergency aid granted to Greek commercial banks.
- After the negotiations clapped through the Bank of Greece, the euro group talked on without Greece, a Plan B:. the measures to be taken to reduce the impact of a Greek default to mitigate as much as possible
- Dijsselbloem gave up after that conversation a press conference in which he stressed that the euro group still has nineteen members (Greece so ). He said the euro group remains in talks with Greece.
- Finance Minister Varoufakis said to believe in a news conference still in agreement. If the agreement is amended, the Greek government gives a positive voting advice for the referendum, he said
- Read more about this.
- ELA
- Emergency Liquidity Assistance
- euro
- European Union
- euro
- Greece
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