| Irish Independent | - |
The
crisis in the eurozone was set to escalate after the Germans said last
night they could not write off Greek debts without offering financial
assistance to Ireland, Spain and Portugal.
Greece crisis: Crunch summit in Brussels, ECB tightens noose on banks
Published 07/07/2015 | 02:30
Open Gallery 24
The crisis in the eurozone was set to
escalate after the Germans said last night they could not write off
Greek debts without offering financial assistance to Ireland, Spain and
Portugal.
In the wake of Greece's
decisive "no" vote in Sunday's referendum on creditor proposals, the
Germans believe that a new debt relief deal is impossible as other
countries across the EU will then demand a bail-out.
Sigmar Gabriel, Germany's
deputy chancellor, said the single currency would not be able to cope if
it had to give financial assistance to other countries across the EU if
they found themselves in similar economic turmoil to Greece.
Mr
Gabriel said plans for humanitarian aid for Greece must now be drawn up
amid fears the country could run out of fuel and food.
Mrs Merkel clashed yesterday with Francois Hollande, the French president, who wants Greece to be offered a generous deal.
Greek
banks were pushed closer to the brink of collapse last night after the
European Central Bank (ECB), the lender of last resort, demanded they
put up more collateral in exchange for emergency loans. Paper is already
running out in Greece and books may stop being published.
The
leaders of all of Greece's political parties last night backed far-Left
leader Alexis Tsipras as he prepared to travel to Brussels to present a
new proposal to the country's creditors.
However, European leaders are expected to reject calls to provide Greece with "emergency liquidity assistance".
In other developments yesterday:
- Yanis Varoufakis, the controversial Greek finance minister, quit in the hope of appeasing the country's creditors.
- A split between France and Germany deepened as a senior ally to Mr Hollande accused Mrs Merkel of failure.
- Tourists travelling to Greece were told to take enough medicine to cover their stay amid fears of shortages.
-
Valdis Dombrovskis, the European Commissioner for euro affairs, said
the organisation will ignore a referendum demand made by Greece for debt
relief because the vote was "not legally correct".
-
Vladimir Putin, the Russian president, yesterday spoke to Mr Tsipras.
Raoul Castro, the Cuban leader, congratulated Greece on the result of
the referendum.
- The
gulf between Germany, which is determined to stick to the rules of the
bloc, and France, Greece's last ally in the Eurozone in calling for a
generous deal, widened last night.
At
a joint press conference ahead of dinner at the Elysee Palace, Mr
Hollande called for "solidarity" with the Greeks. "Europe is not just an
economic, financial and monetary construction, Europe is a whole set of
principles and values.
"A conception of the world," he said
But Mrs Merkel said the "preconditions" for a fresh bail-out "are not yet there".
"We have already shown a great deal of solidarity to Greece," she said.
"The
proposal we put to them was already extremely generous. We have to
remain consistent." She said that listening to the 18 other eurozone
states "is also democracy".
Benoit
Hamon, the former French education minister, said: "Merkel has lost.
Germany has lost. It is an opportunity for Francois Hollande to resume
leadership."
Today,
eurozone leaders will meet in Brussels to discuss if any prospect of a
deal can be salvaged from the fallout of the Greek vote.
Irish Independent
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