Greek Banks To Remain Closed Next Week After Bailout Is Denied By EU

Greek banks will remain closed this upcoming week as the country is due to pay off it’s 1.6 euro debt to the International Monetary Fund (IMF). On Tuesday, Greece‘s bailout will officially expire and the European Central Bank has recently denied the country’s request for an extension on the current bailout. Why is this happening? Because Greece is trying to prevent citizens from making more banks withdrawals than it can handle. What does this all mean for Greece?

Without a bailout, the country will be on it’s own. Recently, the EU made a statement on the future of Greece’s economy without a bailout. The collective known commonly as the “Eurogroup” stated that the situation “will require measures by the Greek authorities” in order to “safeguard stability of the Greek financial system.” So far, efforts to stabilize Greece have failed. The country is moving closer to leaving the euro-zone, according to BBC. But it’s own fate is not the only thing Greece’s financially crisis is jeopardizing.

The Greek debt crisis threatens the stability of the entire European Union. In the meantime, there will eventually be a national vote for Greece’s future in the Eurozone. A vote of “yes” will mean that Greece keeps the euro currency; “no” will mean that Greece will be rid of the euro and create it’s own currency. The “no” vote will reportedly be more beneficial for the EU than for Greece. Because of the detriment that leaving the Eurozone can cause for Greece, the Prime Minister, Alexia Tsipras, publicly criticized the Eurozone finance ministers for their refusal to extent the bailout.

“It is clearer than ever that this decision has no other goal apart from blackmailing the Greek people and obstructing the smooth democratic procedure of the referendum.”

Greeks are reportedly attempting to encourage Tsipras to vote “yes’ in the upcoming referendum. The referendum comes after seven years of severe financial struggle for Greece. The head of I.M.F recently released a statement explaining his disappointment with resolving the problem in Greece.

“I shared my disappointment and underscored our commitment to continue to engage with the Greek authorities.”

Despite the failure to stabilize Greece, Lagarde also stated that the I.M.F. would ”continue to carefully monitor developments in Greece and other countries in the vicinity and stands ready to provide assistance as needed.” Though many Greeks and EU finance officials are looking forward to the referendum as a means of solving the financial issue in Greece, others feel that its only the beginning. Raoul Ruparel, an economist, made a statement which suggests just that.

“I think we are just getting started on this merry-go-round. We would then be back where we started, only in a worse situation.”

Greece is reportedly in the way of the 60-year project of building a unified Europe. Ruparel states that things are looking bleak for Greece.

“The whole thing is absolute nightmare.”

[Image via Euractiv]