GREEK prime minister Alexis Tsipras yesterday vowed to press ahead with a referendum on austerity measures after Greece became the first developed nation to miss a International Monetary Fund (IMF) debt repayment.
A few hours after Greece missed the deadline for a €1.5 billion (£1bn) payment, Mr Tsipras made a defiant appearance on television urging the people to vote against the budget cuts that the IMF and European Central Bank (ECB) demands in return for a bailout.
With his country plunged into economic chaos, the prime minister had earlier offered new concessions to eurozone partners.
In a letter sent to creditors – the IMF, ECB and the European Commission – Mr Tsipras said he was prepared to accept a bailout deal put forward last weekend, if a few changes were agreed to the conditions.
His latest proposal followed a failed attempt to secure a €29.1bn bailout deal from the European Stability Mechanism, the rescue fund for eurozone countries.
His letter to creditors indicated his government was prepared to accept their proposals, subject to certain amendments.
Some European countries – including Germany, the largest single contributor to Greece’s bailout – said the proposal was not good enough and that a deal remained impossible in any case before the referendum.
“We will wait for the referendum,” chancellor Angela Merkel told the German parliament. “There can be no negotiations on a new aid program before the referendum.”
French president Francois Hollande said it was the responsibility of other countries that use the shared currency to keep Greece in the eurozone.
“We have to be clear. An accord is for right now, it will not be put off,” he said. “If it doesn’t happen, we would have to wait for a referendum, but there is always a risk of turbulence and a leap into the void.”
Mr Hollande, a Socialist who has been one of the few remaining EU allies of Greece’s leftist government, criticized “intransigent comments” and “vetoes or roughness,” in an apparent reference to Germany’s tough stance.
“It is our duty to keep Greece in the eurozone,” he said. “That depends on Greece... but it also depends on us.”
Hopes that Mr Tsipras was softening his position – after refusing for five months to accept the proposed spending cuts – boosted markets yesterday.
With the Greek public prevented from taking more than €60 per day out of a banking system that is running out of cash, Mr Tsipras used his television appearance to promise people their pensions and wages would be safe.
He thanked Greeks for their “calm” in the face of bank closures and angrily denied he had a secret plan to take Greece out of the euro, calling those who made that accusation “liars”.
“There are those who insist on linking the result of the referendum with the country’s future in the euro,” Mr Tsipras said.
“They even say I have a so-called secret plan to take the country out of the EU if the vote is ‘no.’
“They are lying with the full knowledge of that fact.”
Meanwhile Chancellor George Osborne said the UK will “prepare for the worst”.