Europe

Greece debt: Varoufakis accuses creditors of 'terrorism'

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Media captionThe BBC's Chris Morris reports on tensions in Greece ahead of Sunday's referendum

Greek Finance Minister Yanis Varoufakis has accused Athens' creditors of "terrorism", the day before a referendum on an international bailout.

Speaking to Spain's El Mundo newspaper, he said the country's lenders wanted to "instil fear in people".

Huge rallies were held by both sides in the referendum on Friday night.

The government has urged voters to say "No" to the terms of a bailout package, but opponents warn that this would see Greece ejected from the eurozone.

Greece's current bailout programme with the European Commission, International Monetary Fund (IMF) and European Central Bank (ECB) ran out on Tuesday.

Banks have been shut all week, with limits imposed on cash withdrawals.

The BBC's Chris Morris in Athens says that, for many, this has become a choice about whether to stay in the eurozone. With so much at stake, he says, the rhetoric is getting nasty.

Image copyright Reuters
Image caption Yanis Varoufakis said Greek banks would reopen on Tuesday, whatever the outcome of the vote

Mr Varoufakis said the so-called "troika" of creditors wanted a "Yes" vote to win so they could humiliate the Greeks.

"Why did they force us to close the banks? To instil fear in people. And spreading fear is called terrorism," he said.

He added that Greek Prime Minister Alexis Tsipras would still reach an agreement with creditors if the result was "No", and that banks in Greece would reopen on Tuesday whatever the outcome.

Correspondents say it is unclear whether this will happen.

"The EU will have no legal grounds to throw Greece out of the euro, and then the real negotiation will start with creditors," Mr Varoufakis told Greek newspaper Kathimerini.


Analysis: BBC Economics editor Robert Peston

If Greeks vote "Yes" to the deal with creditors - pension cuts, VAT rises and all - just maybe the European Central Bank (ECB), whose governing council meets on Monday morning, will lift the ceiling a fraction on the provision of Emergency Liquidity Assistance (ELA).

That might not permit banks to start operating as normal with immediate effect. But it could allow the 60-euro daily ceiling on withdrawals to be raised a bit, and the total freeze on transfers abroad to be eased somewhat.

And that might allow the Greek economy to be taken out of the deep freeze it has been in since banks were ordered to more-or-less close last Monday.

But if Greeks vote "No", as the government wishes them to do, there would be zero chance of the ECB turning on the ELA tap again.

Life-or-death referendum


German Finance Minister Wolfgang Schaeuble, one of Greece's harshest critics, suggested that if Greece were to leave the eurozone, it might only be temporary.

"Greece is a member of the eurozone. There's no doubt about that," he told German newspaper Bild.

"Whether with the euro or temporarily without it: only the Greeks can answer this question. And it is clear that we will not leave the people in the lurch."

Tens of thousands of Greeks attended the rival rallies on Friday night.

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Media captionIoanna Stefanaki of "Yes" campaign: "No will be catastrophic"

Mr Tsipras told supporters Greece needed to "say a proud 'No' to [European] ultimatums" to sign up to fresh austerity.

But he also used similar language to Mr Varoufakis, urging Greeks to "say 'No' to ultimatum, to blackmail, to the campaign of terror".

He denied a "No" vote would mean leaving the European Union - though opponents said they believed Mr Tsipras could not deliver on such a promise.


Ballot paper question

"Must the agreement plan submitted by the European Commission, the European Central Bank and the International Monetary Fund to the Eurogroup of 25 June, 2015, and comprised of two parts which make up their joint proposal, be accepted? The first document is titled "reforms for the completion of the current programme and beyond" and the second "Preliminary debt sustainability analysis".

Voters must check one of two boxes - "not approved/no" or, below it, "approved/yes"

Voices from a Greek island

The question that makes (almost) no sense


Opinion polls on Friday suggested the country was evenly split. An Ipsos survey put "Yes" supporters at 44% and "No" at 43%.

Opinion polls within 24 hours of the voting are banned, as are rallies.

Image copyright Reuters
Image caption "No" supporters turned out in force in Athens on Friday
Image copyright AFP
Image caption The "Yes" rally took place close by

Greece's left-wing Syriza government was elected in January on an anti-austerity platform.

The European Commission, the European Union's executive arm - one of the "troika" of creditors along with the International Monetary Fund and the ECB - wants Athens to raise taxes and slash welfare spending to meet its debt obligations.

On Tuesday, the previous eurozone bailout expired, depriving Greece of access to billions of euros in funds, and Athens missed a €1.5bn (£1.1bn) repayment to the IMF.


Lenders' proposals: Key sticking points

  • VAT (sales tax): Alexis Tsipras accepts a new three-tier system, but wants to keep 30% discount on the Greek islands' VAT rates. Lenders want the islands' discounts scrapped
  • Pensions: Ekas top-up grant for some 200,000 poorer pensioners will be phased out by 2020 - as demanded by lenders. But Mr Tsipras says no to immediate Ekas cut for the wealthiest 20% of Ekas recipients
  • Defence: Mr Tsipras says reduce ceiling for military spending by €200m in 2016 and €400m in 2017. Lenders call for €400m reduction - no mention of €200m

Source: European Commission document, 26 Jun 15 (pdf)

Greek debt jargon explained

Tsipras and his Greek gamble


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