Greeks rush to withdraw cash as MPs debate bailout referendum

GMT 21:10 2015 Saturday ,27 June

Arab Today, arab today Greeks rush to withdraw cash as MPs debate bailout referendum

People stand in a queue to use ATM machines
Athens - AFP

Greek lawmakers on Saturday debated whether to hold a controversial bailout referendum as fears of a default intensified and worried customers began queueing to withdraw money.

Prime Minister Alexis Tsipras, who last night stunned Greece's creditors with his call for a July 5 referendum on their cash-for-reforms plan, will address parliament ahead of a midnight vote by MPs on whether to stage the plebiscite. Results are expected about one hour later.

Eurozone finance ministers meeting in Brussels raised the stakes meanwhile by refusing to extend Greece's bailout until after the proposed referendum, insisting on sticking to the programme's June 30 expiry date. That same day, Athens must pay a crucial 1.5 billion euro IMF debt payment or risk a default and possible exit from the euro.

The uncertainty sent Greeks rushing to ATMs in fear of capital controls and more financial chaos after nearly six years of crisis and deep recession.

In Greece's second city, Thessaloniki, some banks have run out of money, according to an AFP reporter, while a National Bank branch had a queue of 50 people.
"I have a shop. I came to the bank to withdraw as much money as I can in order to cover the needs of my shop for next week," 42-year-old Maria Kalpakidou told AFP.

"If we don't have an agreement by July 4, the Greek banking system will crash."

Private employee Nikos, 52, added: "There is a lot of fear of what may happen.

"In the last election I voted for Syriza. But we voted for them to decide, not to transfer responsibility to us, to the Greek people."

Another bank customer, Sofia Makridou, told AFP that there is "great uncertainty and insecurity for what may happen", adding it is "rational that there is a bit of a panic".

In central Athens, small groups of between three and 10 people were seen queueing at 10 different ATMs.
At the Greek parliament, several sources told AFP that the two cash machines there had run dry, but they were later reported to be operating as normal.

A Greek central bank source said it would do "whatever possible" to make sure that cash machines were stocked.

Banking deposit withdrawals had already accelerated sharply in recent days amid increasing acrimony in the tough negotiations between Athens and international creditors to reach a debt deal that could stave off a so-called "Grexit".

- 'A loud no to austerity' -

The premier's shock referendum call came after Greece on Friday rejected its international creditors' offer of a five-month, 12-billion-euro ($13.4-billion) extension of its bailout programme, arguing that the reforms demanded in return for the cash were unacceptable.
The creditors' proposals included more labour market deregulation, pension cuts, further reductions in public sector wages, higher VAT on food, restaurants and tourism, and the elimination of tax breaks for far-flung Greek islands.

Tsipras' radical leftist Syriza party has urged Greeks to vote against the proposal in the referendum, arguing it would worsen austerity in a nation already buckling under economic hardship.

"We are calling the working people, the youth, the pensioners, the farmers, to turn down the ultimatums of the creditors," Syriza's political secretariat said in a statement.

"We call the Greek people to say a loud 'No' to the heavy hand of austerity."

Greek Finance Minister Yanis Varoufakis said Athens was still fighting for a better deal.

"The question we are putting to the Greek people is: do you agree that we should sign on the dotted line on the proposal of the institutions?" he said in Brussels.

"We are leaving room for the proposal to be improved," he insisted.

Greek financial newspaper Naftemporiki described Tsipras's announcement as a "referendum bomb" that came as an "absolute surprise inside and outside the country".

A recent opinion poll showed that more than three-quarters of Greeks want to remain in the eurozone, while just 16 percent called for the return of its old drachma currency.


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