No negotiations until after Greek referendum, says Merkel
Auteur: Honor Mahony
Greek leader Alexis Tsipras i made a last ditch attempt to reach a deal on Tuesday (30 June) by offering to accept most of creditors' demands in return for a new €29 billion loan but Germany's Angela Merkel i has said there will be no negotiations until Greece’s referendum on 5 July - a referendum that it is itself clouded in confusion.
Tsipras' letter to the EU commission, European Central Bank, and IMF said he would accept proposals laid out by creditors with amendments that included a reduction on VAT for Greek islands and maintaining some pension supplements.
It came as Greece's second bailout expired at midnight on Tuesday along with a deadline to pay back a bill to the IMF - with its default putting it in a small club of nations that include Zimbabwe, Somalia and Sudan.
It also means the country is without an international financial lifeline for the first time since 2010 - bringing more uncertainty for the Greek people who are already faced with closed banks and a €60 cap on daily cash withdrawals.
However an evolution in the process is set to come only after Sunday's referendum.
Germany has said it will not enter into negotiations on a third bailout until after the referendum is held - with Tsipras himself having indicated that if the Yes side wins he will step down.
Speaking in the Bundestag on Wednesday, Merkel said: "We'll wait for the referendum - no new programme can be negotiated beforehand."
She added, in an address that was also run live on Greek TV, that Europe is able to wait "calmly" for the vote because its recent reforms have made it "strong".
"The current situation is without doubt a big challenge for us. But it is especially a torture for the people in Greece."
The chancellor said the door remains open to Greece but that she is not prepared to make a deal "at any price" and stressed that the eurozone is built on rules and responsibility.
Eurogroup teleconference
Eurozone finance minister are due to discuss Greece's latest request in a teleconference call at 5.30pm Brussels time, with the commission due to give its opinion on it beforehand.
Euro commissioner Valdis Dombrovskis i said on Wednesday that a new bailout deal for Greece is possible before new major payments come due, with 20 July and an ECB repayment seen as an absolute deadline for Athens.
He also noted that with capital controls, in place since Monday, "much more efforts will be needed to restore the situation".
Meanwhile confusion over Greece's referendum is continuing. Greek are being asked to approve or reject two highly technical documents from creditors.
In addition the documents refer to a bailout that has already expired and there have been reports of translation problems.
What will the vote mean?
It is also unclear what the practical consequences of a No vote would be. While the vote is ostensbily on the (no-longer-valid) creditors' proposals, other EU states say a No would mean a euro exit.
This has led to the Council of Europe, the continent's human rights watchdog, to condemn the proposed vote as falling below international standards.
Thorbjorn Jagland, head of the organisation, told AP that the questions were "not very clear" and the referendum itself had been called at very "short notice".