Greek parliament backs PM Tsipras’ bailout referendum

Lawmakers approve leftist government’s decision to put fresh austerity measures proposed by creditors to vote.

The Greek parliament has backed Prime Minister Alexis Tsipras’ call for a referendum on the country’s bailout deal with international creditors.

The referendum planned for Sunday July 5 was approved by at least 179 deputies out of a total of 300 lawmakers.

The creditors have not sought our approval but have asked for us to abandon our dignity. We must refuse.

by Alexis Tsipras, Greek prime minister

Tsipras’ leftist Syriza party and allied lawmakers voted in favour of the referendum that has angered its creditors who earlier rejected the debt-ridden country’s request for a bailout extension.

The country needs to make a $1.8bn payment to the International Monetary Fund by Tuesday or risk defaulting on its obligations.

And that would spell disaster for its banking system which is currently relying on emergency cash injections from European Central Bank – one of its foreign creditors.

In a speech prior to the vote, Tsipras said he was confident that “the Greek people will say an emphatic no to the ultimatum” by the country’s creditors – the International Monetary Fund, European Central Bank and European Commission.

“The day of truth is coming for the creditors, the time when they will see that Greece will not surrender, that Greece is not a game that has ended,” he said in an address to parliament laced with references to democracy and national dignity.

“I am certain that the Greek people will rise to the historical circumstances and issue a resounding ‘No’ to the ultimatum,” he said as he wound up the debate before a vote to authorise the referendum.

Grexit ‘almost inevitable’

Tsipras also expressed confidence that “in the aftermath of this proud no, the negotiating power of the country [with the country’s creditors] will be strengthened”.

The move comes after five months of stalemated negotiations, with Tsipras accusing creditors of trying to strong-arm his country into taking harsh austerity measures he says would hammer an economy already on its knees after five months of creditor-demanded spending cuts and tax hikes.

Expert: Referendum plan a good idea

“The creditors have not sought our approval but have asked for us to abandon our dignity. We must refuse,” Tsipras said during a nearly 13-hour parliamentary session that cumulated in a vote just before 3am on Sunday.

But the leader of the opposition called the referendum a coup, Al Jazeera’s John Psaropoulos, reporting from Athens, said.

Austria’s finance minister said on Sunday that Greece’s exit from the eurozone “appears almost inevitable”, after EU
leaders refused to extend Athens’s desperately needed bailout after the call for the referendum .

“Greece is solely responsible for a failure of the negotiations,” said Hans Jorg Schelling in an interview with Austrian newspaper Die Presse.

He added that a so-called Grexit was would only be possible if Greece got the permission of other member countries. 

“Greece would have to file a request to do so. The other EU countries would have to approve the request. Only then could Greece leave the eurozone,” he said.

“The consequences for the euro countries are not nearly as bad as for Greece,” Schelling added.

“It’s clear that one country can under no circumstances blackmail the European Commission and the euro countries.”

Also on Sunday, European Council President Donald Tusk said that Greece must remain part of the euro single currency area, adding that he was in touch with government leaders to prevent Athens dropping out of the monetary union.

“Greece is and should remain euro area member,” he tweeted.

“In contact with leaders to ensure integrity of euro area of 19 countries,” he added after the other 18 finance ministers met without their Greek counterpart in Brussels.

Tsipras has accused its creditors of demanding new pension cuts, sales-tax increases and labour market reforms.

Source: Al Jazeera, News Agencies