George Osborne has unveiled his latest budget: here are the key pointsRevised down for 2015 to 2.4% from 2.5%. Forecast to grow 2.3% next year – the same as the last budget – and then grow the year after that.Rowena Mason, political correspondent: Osborne gets this little bit of negative economic news out of the way early in his speech, moving on swiftly to boasts about higher tax receipts and creation of more jobs.RM: The chancellor is repeatedly trying to emphasise that his cuts will not be deeper or more severe than in the last parliament, attempting to cast them as moderate in the face of some Tory jitters about the scale of the public spending reductions.Osborne does in fact appear to have watered down his planned cuts, with higher public spending than he forecast in March and an extra year to achieve his aim of a budget surplus. In fact, the Office for Budget Responsibility says he is using the budget to ‘loosen significantly the impending squeeze on public services spending’.RM: Osborne is risking strikes here with continued public sector pay restraint for another four years – on top of the last five years. That will be almost a decade of low pay rises for public sector workers.RM: Labour’s idea of a crackdown on non-doms has been nakedly stolen by Osborne, who rejected Ed Miliband’s popular idea before the election. He is not quite going as far as Labour, which recommended abolishing it, but anyone resident in the UK for 15 of the last 20 years will no longer get to enjoy the status. Osborne repeatedly unveils crackdowns on tax avoidance but Labour has questioned how much it actually raises.RM: It sounds like this could raise more money from the banks than the current levy. It’s another idea very similar to one of Labour’s pre-election pledges that Osborne has borrowed.RM: Tory backbenchers will be breathing a sigh of relief that fuel duty is again frozen but it’s not clear what the reformed vehicle excise duty to pay for new roads will mean for either motorists or the environment.RM: This looks rather like a tax, despite Osborne’s pre-election claims that tax rises would not be necessary.RM: This is going to prompt claims that Osborne is disproportionately targeting the young when seeking savings. The Sutton Trust has already said it could tip the balance against low and middle income youngsters going to university.RM: Osborne’s plan to create a northern powerhouse really gets up the nose of Labour MPs who feel this should be their territory. However, Labour has begun to point out where the plans are more style than substance.RM: This was heavily trailed and is opposed by all the Labour leadership candidates as well as trade unions.RM: This is an interesting move that suggests Osborne is at last acknowledging the ‘risks to stability’ of an overheating housing market.RM: A key plank of the Tory manifesto, the chancellor is signalling this is a priority by implementing it so early in the parliament – seven years after he first promised it while in opposition.RM: This looks like a major shake-up to stop tax avoidance through use of personal service companies.RM: This may be a concession to business as the government tries to put pressure on companies to raise wages for the lowest earners. But it is a bold move at a time when he is about to slash welfare and the rate is already at the lowest in the G7.RM: Osborne seemed to promise no more cuts to BBC budget in return for it taking on the extra cost of free TV licences which could explain why the corporation has accepted it.RM: Osborne has wriggled out of David Cameron’s promise not to cut benefits for the “most disabled”.The rest of the announcement is as expected given the heavy hints about reforming the tax credit system but is likely to draw intense criticism that Osborne is punishing children who cannot help being born in into large, low income families. Labour will now have to decide whether it can stomach this in pursuit of appearing tough on welfare, along with the lower benefit cap and removal of housing benefit for under-21s.RM: The Conservatives have whole-heartedly adopted this policy from the Lib Dems despite criticism that it no longer helps the lowest paid because they are now already exempt from taxation. It is some of the best paid in the workforce around the higher rate threshold who will get the biggest benefit.RM: This is the rabbit from the hat. After giving businesses a cut in corporation tax and lower national insurance contributions for small firms, they will be forced to pay their workers who are over 25 at least £7.20 an hour, rising to £9, by 2020. Osborne said 2.5m of the lowest paid will get a pay rise.RM: The government was vulnerable on this after criticism from military figures, Tory backbenchers and US officials, so some extra money for defence has obviously been found down the back of the Treasury sofa. Continue reading...

Fears for the euro’s political sustainability are vastly overblown. Grexit would be an unprecedented event, but poses no existential threat to the single currencyWith a final decision about Greece’s future in the eurozone expected on Sunday, the crucial question in the mind of European leaders will be what a deal would mean for the short- and long-term sustainability of eurozone and European integration. Since coming into office, the Athens government has relentlessly argued that Greek expulsion would inevitably trigger an unravelling of the monetary union, and ultimately deal a fatal blow to the European project itself.Until recently this narrative had gained little traction, but as Grexit becomes the default scenario and media coverage more frantic, more commentators warn of a potential “Lehman moment” for the EU. They fear that Grexit would undermine public trust in the core values of the EU and turn the eurozone into a currency-peg arrangement, which will be unpicked by financial markets or populist political leaders seeking an easy way out. Even the German weekly Der Spiegel showed Merkel sitting on ancient Greek ruins, under the headline: “If the euro fails, so does Merkel’s chancellorship”.Related: Alexis Tsipras: Greece used as 'austerity laboratory' – live updatesGrexit would increase the chances of further eurozone deepening through stronger institutions and fiscal policy Continue reading...

Alexis Tsipras remains hopeful that by end of week he will reach an agreement in best interests of both Greece and the eurozoneGreece has submitted an application for a third bailout programme, in an attempt to avoid crashing out of the eurozone.The finance minister, Euclid Tsakalotos, marked his third day in office by requesting a three-year aid plan from Europe’s permanent bailout fund, the ESM.* Reuters poll-median 55 pct probability of Greece leaving Euro zone: economists (45 pct last week; first ever over 50 pct).@ManfredWeber "Mr Tsipras, the extremists of Europe are applauding you. You are surrounding yourself with the wrong friends."Weber: Rather than holding referenda, other member states have got on with reforms and fiscal consolidation your rule has been catastrophic Continue reading...

I think we’ll all have a few pressing questions for George Osborne tomorrow, but for now, allow me to tell you what budgets are all about

The country’s financial crisis has made day-to-day living hard – affecting everything from paying the rent to restrictions on what people can buy1 CashGreeks cannot withdraw more than €60 – about £43 – a day from cash machines. Cash is running out, with shortages of €5, €10 and €20 notes and €1 coins. Queues at cash machines are long.Related: Greece given days to agree bailout deal or face banking collapse and euro exit Continue reading...

Here are key graphs to consider as George Osborne presents his spending and savings plans, and growth forecasts, in his first budget since the electionThe UK’s economic recovery appears to be established, with GDP rising for nine consecutive quarters now and above its pre-crisis peak. But the latest data showed the growth rate halved in the opening months of 2015 to 0.4%, from 0.8% in the final quarter of 2014.The OBR may expect a further upward revision in time. Nonetheless, we expect its 2015 forecast to fall from 2.5% to 2.4% or 2.3%. If the chancellor is lucky, the OBR will just assume that the first quarter’s weakness was temporary, rather than indicating that the economy’s potential growth is weaker than it thought.”On Greek crisis, while we hope for the best, we now need to be prepared for the worst. Continue reading...

After Argentina ended the peso’s peg to the dollar, its economy collapsed. Yet five years on it was booming. Could that crisis provide a role model for Greece?An economy in freefall. A run on the banks. Curbs on the amount of money that could be withdrawn from accounts. A team from the International Monetary Fund called back to Washington.Greece in July 2015? No, this was Argentina in late 2001, when the currency peg between the peso and the dollar was coming under extreme pressure, and capital was leaving the country at an alarming rate. Continue reading...

Athens told to present convincing details or EU leaders will hold emergency meeting in Brussels on Sunday to deal with Grexit

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The impasse between Athens and Berlin demands an active mediator. Step forward François HollandeThe Greek crisis has reached a point where a mediator could play a crucial role. Eurozone leaders are gathering yet again for an 11th-hour attempt at compromise. This may offer a fresh chance for dialogue and open consultation, but it risks falling short of the kind of hands-on effort that is needed when the task is to steer both sides away from a hugely damaging impasse.Throughout the crisis there has been the clear possibility of an ultimate clash between, on the one side, Greece’s Syriza government and, on the other, the Brussels institutions – with Germany looming in the background. Intractable conflicts of this kind frequently need an even-handed mediator who addresses complaints, weighs the odds and options, and proposes terms on which adversaries might be persuaded and pressured into agreement.Related: Angela Merkel must act now for Greece, Germany and the world | Letters from Thomas Piketty, Jeffrey Sachs and others Continue reading...

Euclid Tsakalotos’s notes were caught on camera before EU meeting, including one apparently warning himself not to gloat about referendum resultEuclid Tsakalotos apparently had to make a written note to remind himself not to gloat about Sunday’s landslide referendum vote before attending his first EU meeting as finance minister of Greece.On a piece of headed notepaper from the Hotel – a four-star, €170-a-night lodgings in Brussels – Tsakalotos, or one of his aides, had jotted down: “No triumphalism.”Related: Greece is the latest battleground in the financial elite’s war on democracy | George Monbiot Continue reading...

As the country plunges further and further into uncertainty, its population is beginning to feel the effects of relentless panic buying and capital controlsCashGreeks cannot withdraw more than €60 – about £43 – a day from cash machines. Cash is running out, with shortages of €5, €10 and €20 notes and €1 coins reported. Continue reading...

From laissez-faire economics in 18th-century India to neoliberalism in today’s Europe the subordination of human welfare to power is a brutal traditionGreece may be financially bankrupt, but the troika is politically bankrupt. Those who persecute this nation wield illegitimate, undemocratic powers, powers of the kind now afflicting us all. Consider the International Monetary Fund. The distribution of power here was perfectly stitched up: IMF decisions require an 85% majority, and the US holds 17% of the votes.The IMF is controlled by the rich, and governs the poor on their behalf. It’s now doing to Greece what it has done to one poor nation after another, from Argentina to Zambia. Its structural adjustment programmes have forced scores of elected governments to dismantle public spending, destroying health, education and all the means by which the wretched of the earth might improve their lives.Related: The euro will be stuck with austerity unless it learns to embrace democracy | Aditya ChakraborttyThose sober, suited, serious people turn out to be demented utopian fantasists, votaries of a fanatical economic cult Continue reading...

Greek prime minister and German chancellor are locked in battle of wills over Greece’s eurozone future that will determine their fatesThey are a study in contrasts, the yin and the yang of Europe’s epic battle for mastery of its destiny. But Angela Merkel and Alexis Tsipras are now almost umbilically linked – the political fate of the one hinging on the policy choices of the other.Related: Greek debt crisis: Emergency summit begins - live updatesRelated: Eurozone tells Greece not to expect debt relief any time soon Continue reading...

Clues from past budgets and manifesto pledges can help us gauge the likely changes, be they welfare benefit cuts, changes in tax and pension allowances, bank levies or fuel dutyGeorge Osborne will soon deliver the first budget by a Conservative government in almost 20 years.His March budget, under the coalition with the Liberal Democrats, provided some clues as to what he might say when he unveils his measures on Wednesday afternoon. The Conservative manifesto also contained a wide range of promises to present a budget for “hard-working families” – one of the chancellor’s buzzphrases.Related: Budget 2015: George Osborne to shake up Sunday trading laws Continue reading...

Exposure to Greek loans is weighing heavily on minds in the eurozone, in Spain, Slovenia and Malta perhaps more than GermanyAs eurozone leaders meet in another effort to broker a deal between Greece and its creditors, those who have lent to the near-bankrupt country are asking if they will ever get their money back.Greece owes €323bn (£228bn) to a combination of official and private creditors, equivalent to more than 175% of its GDP. Much of that debt mountain was built up by Greece receiving bailout packages, funded in part by its eurozone neighbours.Related: Eurozone tells Greece not to expect debt relief any time soon#UK has limited exposure to #Greece around €1.3bn via IMF & €9.85bn indirectly via banking sector http://t.co/gkBZYPFIae“Will the IMF’s shareholders suffer losses if Greece does not repay?No, the IMF’s shareholders will not suffer losses. Continue reading...

Hopes fade for quick solution to thwart Grexit as Eurogroup finance chiefs show incredulity as new Greek finance minister arrives without detailed proposals

The question for councils is how quickly their localist dream of having more powers could become a nightmare when there is no money leftOne advantage of having a budget in the summer is that it falls in the conference season of those who run public services. This gives a chance to check the impact of the chancellor’s plans in the real world. And the first of those checks comes on the journey to the local authority conference: it takes a mere two hours and 10 minutes by train to travel the 200 miles from London to Leeds, at a speedy 92mph. But there’s a sudden change of pace when you change trains: the final 15 miles from Leeds to Harrogate take 35 minutes on a train that goes a steady 26mph.It’s a reminder of why northern councils were furious when, just weeks after the election and bold talk of a northern powerhouse, the chancellor George Osborne took another look at Network Rail’s books and froze the plans for vital upgrades to major rail lines in the Midlands and the north of England. After the promises, northern councils felt they were once again fighting over the crumbs – a mere 14% of transport infrastructure spending is outside London and the south-east.Related: Devolution means local government can afford to be more ambitious | Bob KerslakeRelated: Revealed: how the stress of working in public services is taking its toll on staff | Society Continue reading...

Economist who was an expert on corporate structure and de-industrialisationThe economist Ajit Singh, who has died aged 74, was a pioneer in the analysis of takeovers and the structure of the modern business enterprise. He also devised the first operational definition of de-industrialisation in advanced economies and was a leading voice in the debate over the dynamics of industrialisation and financial markets in the developing world.Singh’s work on corporate behaviour resulted in two major publications, Growth Profitability and Valuation (1968, co-authored with Geoffrey Whittington) and Takeovers: Their Relevance to the Stock Market and the Theory of the Firm (1972). In these two books Singh tested the work of the Cambridge economist Robin Marris, who, developing research on corporate structure in the 1930s by Adolf Berle and Gardiner Means, had argued that the role of disciplining corporate managers and of aligning their decision-making with the welfare of shareholders would be played by the stock market alone: in other words, that the market will ensure efficiency by selecting the fittest companies for survival. Continue reading...

The contradiction of capitalism is that growth just feeds those who are already wealthy. Instead Greece should regain the drachma and keep for-profits at bayGreece’s no vote has left everyone wondering what it all means. While the topline summary is that no won with 61.3% of the vote, this is perhaps not the landslide victory it has been hailed to be.For a start, there is confusion around what the referendum was actually about. Were Greek people voting to decide whether to stay in the Euro? Was it about saying no to more austerity? Or defending national pride and southern European culture? Talking to Greeks yesterday, you might have thought there were several referendums happening simultaneously – a perfect illustration of just how muddy the waters of the debt crisis are.Related: Growth is not the answer to inequalityRelated: A wave of disruption is sweeping in to challenge neoliberalismRelated: Less material consumption is not the end for business Continue reading...

Industrial production and the North Sea sector rises, housing is boosted, but manufacturing remains down, making the UK’s economic growth unbalanced

The biggest markets fall more than 3% after investors were unnerved by leader’s failure to address the plunge in a statement on the economyThe sell-off on Chinese stocks continued on Tuesday despite government efforts to bolster the markets amid investor unease that premier Li Keqiang failed to mention the deepening crisis in a statement on the economy.

US treasury secretary Jack Lew says Washington is ‘looking forward’ to a swift agreement as Asian markets stabiliseInternational pressure is mounting on Greece and its European creditors to reach agreement and steer the eurozone away from a potentially disastrous “Grexit”.The US treasury secretary, Jack Lew, told Greece’s prime minister, Alexis Tsipras, and its new finance minister, Euclid Tsakalotos, that Washington “looked forward” to a swift resolution to the crisis unfolding in Europe. Continue reading...

The communist leadership is subsidising speculation as it tries to protect millions of small investors from being wiped outNervous about the Chinese stock market? You should be. First, it looks expensive, even after a dip. Second, the authorities in Beijing, by adopting increasingly desperate measures to prop up share prices, are sending an unmistakable message that they fear a crash is a possibility.The latest official attempt to manipulate the stock market would be laughed out of court if it were attempted in the west. The central bank is shovelling cash towards a state-backed finance company that lends to individuals who would like to make bigger bets on the stock market than they can afford. That’s right, in today’s communist China, there are subsidies for stock market speculation. Continue reading...

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As cash becomes more scarce and supermarket shelves empty, Greek people increasingly fear the onset of a siege mentality

Heads of governments at odds as Germany and European commission let Greece stew, while France, Italy and Spain are impatient for a dealGermany and France scrambled to avoid a major split over Greece on Monday evening as the eurozone delivered a damning verdict on Alexis Tsipras’s landslide referendum victory on Sunday and Angela Merkel demanded that the Greek prime minister put down new proposals to break the deadlock.As concerns mount that Greek banks will run out of cash, and about the damage being inflicted on the country’s economy, hopes for a breakthrough faded. EU leaders voiced despair and descended into recrimination over how to respond to Sunday’s overwhelming rejection of eurozone austerity terms as the price for keeping Greece in the currency.Related: Greek debt crisis: Alexis Tsipras seeks last chance deal - liveThe prospects of a happy resolution of this crisis are rapidly diminishingRelated: Greek referendum: smart response from Tsipras, but triumph may be brief Continue reading...

In such grim times, it’s wonderful to celebrate the collective courage of the Greeks, who – with a leadership capable of offering a vision of a different future - rejected the troika (Greek voters defy Europe, 6 July). Of course it is going to be horrendously tough, but then it would be if they had grovelled and voted yes. We tell our children (albeit with feminist and anti-slaving caveats) that democracy was invented by the Greek city states. This demonstration of democracy in action is surely one of Greece’s finest moments.How can we offer solidarity? Buy Greek products as a positive version of boycotting those of repressive regimes, and, if we have the resources, holiday there in locally owned hotels. Yes, these are very modest suggestions, yet given the utter lack of an alternative vision from Britain’s “left of centre” parties where the centre has drifted so far to the right, practical support of the Greek people might help us believe that there is an alternative.

At a joint press conference with French president François Hollande, Angela Merkel, the German chancellor, says Greece can still negotiate with creditors, but that proposals must be made quickly to find a cash-for-reform deal. The chancellor also urged Greece to put proposals on the table this week, adding that time was of the essence in reaching an agreement Continue reading...

Shares bounced more than 10% after more than 20 major institutions pledged to spend 120bn yaun, but small investors’ panic slashed figure to final gain of 2.4%China’s stock market collapse, which has knocked almost a third off share values since June, appeared to have been stemmed on Monday after Beijing authorities orchestrated a massive spending spree by Chinese financial institutions to bolster the market.The Shanghai Composite Index initially bounced more than 10%, after more than 20 major stockbrokers and fund managers pledged to pump at least 120bn yuan (£12.3bn) into the market and started hoovering up shares in some of the country’s largest businesses.There will be some fluctuation, but more money put into the market – I think it will be helpful to keep it steady Continue reading...

Leftwing Podemos praises Greek Syriza party but talks up differences between the two eurozone countries to calm voters’ fears of economic contagionFor the past year, they have positioned themselves as allied agents of a change sweeping across southern Europe.On the face of it, Spain’s leftwing anti-austerity Podemos party should have been crowing at the landslide victory of the no vote in Sunday’s Greek referendum. But while Podemos leader Pablo Iglesias was quick to praise Syriza and Greek prime minister Alexis Tsipras, his overriding message was a simple one – Spain is not Greece.Related: Greece debt crisis: Banks to stay closed on Tuesday and Wednesday - live updates Continue reading...

Iranian businesses eye the trade that ending sanctions would bring, but say: don’t expect a Russia-style gold rush – we already have a free marketHamid Mohammadi is excited at the prospect of international sanctions on Iran being lifted once a nuclear agreement has been signed. But he’s not that excited. The CEO of the Islamic republic’s equivalent of Amazon is certainly looking forward to being re-connected to the outside world – vital for a fast-growing company at the cutting edge of digital innovation. But ending sanctions will not be a miracle cure for the country’s economy.Digikala, launched with three employees in 2007, will have 1,500 by the year’s end as its slick Farsi-language online shopping service expands. It symbolises the energy of a young generation of wired and entrepreneurial Iranians who have built a domestic market from scratch and prospered despite international isolation. It guarantees deliveries within four hours in Tehran and its site boasts a whopping 750,000 unique visitors a day. Continue reading...

Despite solid economic growth since the downturn, Britain struggles to get more out of each hour worked“If you think you are really good, you won’t try to do any better.” Ian Knight is explaining the philosophy behind his company’s pursuit of productivity growth – something that has eluded so many British businesses in recent years. “We never quite get to where we want to be. The finish line is always moving.”In a bright, clean factory in Walsall, Knight, a “black belt” in the ultra-efficient production method six sigma, stands under a sign reading: “Embrace, enjoy and drive change.” State of the art machinery measures, cuts, strips and crimps cables. All around, Knight’s colleagues are assembling the complex control panels that PP Electrical Systems sells to other manufacturers, to be attached to their own products such as machine tools and food processing equipment.We are not asking staff to work harder. We are looking to make their job better Continue reading...

German reaction to referendum result points to a hardening approach that envisages the eurozone without GreeceWaiting at Berlin’s Zoo station for an S-Bahn train to take her home from a night shift, Diana Well took a glance at the daily papers being sold on the platform. “What now, chancellor?” she said, reading out the headline in the tabloid Bild. “Yes, that’s just what I’d like to know,” the 54-year-old said.

Now that Greece have returned an overwhelming no vote in the referendum, columnist Jonathan Freedland and economics editor Larry Elliott discuss the possible next moves for the European leaders. Alexis Tsipras has thrown the ball into Angela Merkel's court, but she is constrained on how far she can concede. And if there are no concessions, must Greece exit the eurozone? Continue reading...

Greek central bank has a currency press outside Athens, but actually going ahead and printing unauthorised notes would be an extreme stepFaced with shuttered banks and ATMs all but drained of cash, but with most of its citizens saying they would rather stay in the eurozone than revert to the drachma, could Greece simply decide to print its own euro notes?It is certainly physically capable of doing so: the Greek central bank owns a press in Holargos, a suburb of Athens, that once printed drachma and is currently one of 14 high-security currency printing works across the eurozone producing euro banknotes. Continue reading...

David Cameron chairs meeting to discuss implications of Greek referendum result and calls on eurozone to reach ‘sustainable solution’ with AthensDowning Street has expressed hope that Greece will remain a member of the European Union but refused to discuss the country’s future in the eurozone.Related: Greek referendum: optimism fades as eurozone says gulf has widened Continue reading...

Economic assistance under the Marshall plan was important to both countries, but it was the granting of debt relief that made a difference to the Germans

Eurozone commissioner says referendum no vote has further complicated talks despite resignation of Greek finance minister Yanis VaroufakisHopes of a truce between Athens and its creditors after the Greek referendum’s resounding rejection of the terms of the bailout were fading fast, as European leaders said the gap between the two sides had widened.The surprise resignation of the Greek finance minister Yanis Varoufakis earlier on Monday had initially boosted hopes of a breakthrough, but the optimism proved shortlived.Related: Greek referendum: what happens now after the no vote?Related: Yanis Varoufakis: why bold, brash Greek finance minister had to go Continue reading...

UK analyst predicts Yanis Varoufakis’s departure may help in Greek crisis talks but, as the City will admit, no one really knows what will occur nextYanis Varoufakis: some of his best quotes‘The Greek bloke’s resigned. He’s run rings round ‘em’.Those words were how one City trader was overheard explaining the resignation of Greek finance minister, Yanis Varoufakis, as he chatted on the phone in early trading, following the Greek referendum.Related: Greek referendum: what happens now after the no vote? Continue reading...

The EU powers told Greeks their world would cave in unless they acquiesced by voting yes. The no vote has raised the political stakes even higherFrom the cradle of democracy, a lion has roared. It is difficult to overstate the pressure the Greek people have both endured and defied. A country that has already experienced an austerity-induced economic disaster with few precedents among developed nations in peacetime has suffered a sustained campaign of economic and political warfare. The European Central Bank – which has only recently deigned to publish some of the minutes of its meetings – capped liquidity for Greek banks, driving them to the verge of collapse. There were stringent capital controls, and desperate queues outside banks followed. A country desperate to stay within the euro was told it would be ejected, and with calamitous results.That’s what the EU pulled off in Italy and Berlusconi – it should have been his people who removed himRelated: Yanis Varoufakis's resignation statement: 'I wear the creditors' loathing with pride' Continue reading...

Vindicated by no vote in Sunday’s referendum, the self-appointed king of anti-austerians recognised he was impediment to prospective dealWhen historians look back at the great Greek debt crisis, the figure of Yanis Varoufakis will feature large. Bold and brash, the self-appointed king of anti-austerians did more to internationalise the folly of austerity politics than any other member of the radical left government of Athens.Related: Greek debt crisis: markets fall and bond yields rise after no vote – liveRelated: Greek crisis: European leaders scramble for response to referendum no vote Continue reading...

On a European scale the collateral damage of Sunday’s vote risks being tremendous – with xenophobic populists emerging as the winnersThere can be no winners in Europe when anti-EU populists such as Marine Le Pen and Nigel Farage think they can claim a victory, as they did when the results of the Greek referendum came out. That kind of extremist support for the no vote will probably be described as a negligible side-show by those who decided the referendum, but that view may be short-sighted. Of course, xenophobic populism wasn’t what Greeks voted in favour of – they want a break from austerity – but the reality is that, on a European scale, the collateral damage of Sunday’s vote risks being tremendous. When the EU project is seen as a failure because it is unable to produce a compromise, those who scoop up the benefit are those who would like the project to disappear altogether.Europe must now brace itself for more turmoil, and more geopolitical weaknesses, unless cool heads can prevail in Brussels and Athens. It is very uncertain that that will happen. The referendum has strengthened the hand of the Greek prime minister, Alexis Tsipras, but it has by no means erased realities, which are that Greece has become bankrupt, that its government remains isolated in Europe (and not only in dealing with northern countries), and that a breakup of the eurozone, as well as a full-on Greek exit from the EU, have become more of a possibility now than ever before. Continue reading...

The media was mesmerised by his motorbike, but Greece’s former finance minister inspired ordinary people by the way he faced down EuropeBack in January, when I was half-awake while listening to the interminable euro discussion, a man for whom English is a second language started speaking poetry. He was talking of his fellow Greeks, who he said chose, “to quote your own Dylan Thomas, to stop going gently into the night and to rage against the dying of the light”. I perked up, and I wasn’t the only one. This was Yanis Varoufakis, an economist, blogger and academic, who was soon to become Syriza’s finance minister.Eloquently, he put into words the suffering and resilience of his fellow Greeks, but this alone did not fascinate the media. It was his “flamboyance” they focused on. Clearly, in the world of Eurocracy, to not wear a tie is radical. Or rude. Or both. Sometimes he wore a leather jacket. Or a Barbour, or a shirt that was perhaps a little bit too tight. He signalled simply that he was not another “suit”, and made the rest of them look stuffy, uptight and clonish. He continued to ride his motorbike instead of being driven by a chauffeur. In this upside-down world, this level of normality meant he was dubbed everything from a rock star to a sex god.He showed how financial issues had become politicised, how old paradigms were broken. He spoke to Eurocrats as equals. Continue reading...

All you need to know about the next move for the markets, the eurozone, Athens and the main players in the Greek debt crisisGreece’s financial system is on the brink of meltdown: banks are reported to have only around €500m left in cash – equal to just €45 (£32) per head of the 11 million-strong population.Related: Greek crisis: European leaders scramble for response to referendum no vote Continue reading...

For Greeks many compelling reasons – practical, historical, existential – to vote no jostled each other for priority. In truth the yes campaign never stood a chanceYes. It’s such a simple word: so easy to say, so pleasing to hear. And, of course, it was the logical choice. At least according to EU officials, who spent much of last week pleading with Greeks to vote yes to the latest proposals put forward to them by their country’s creditors. The EU’s president, Jean-Claude Juncker, was almost disconcertingly emotional when last week he declared (somewhat elliptically, it must be said): “I will tell the Greeks, whom I love deeply, that you shouldn’t choose suicide just because you are afraid of death … A no would mean, regardless of the question posed, that Greece had said no to Europe,” he added, perhaps to clarify things.But now, as I write this in the early hours of Monday morning, as the final votes in Greece’s referendum come in, it’s clear that the no campaign – with over 60% of the vote – has triumphed. Athenians are reacting to a critical political event with characteristic exuberance: in Syntagma Square outside the parliament, they wave Greek flags and cheer; nearby, in the anarchist stronghold of Exarchia, they set things on fire and fight the police.Nothing is more emotive, and more pregnant with historical and political meaning for Greeks, than one simple word: no Continue reading...

The controversial minister says he is standing down after pressure from Greece’s ‘assorted partners’The Greek finance minister Yanis Varoufakis has quit, despite the country’s decisive rejection of the eurozone’s terms for the country remaining in the single currency.Varoufakis, who infuriated eurozone leaders and recently compared Greece’s creditors to terrorists, said the Greek prime minister, Alexis Tsipras, thought it would be better if he stood down, after pressure from European leaders.Related: Greek referendum: finance minister Yanis Varoufakis resigns – liveRelated: Greek referendum result: what happens next? Continue reading...

Merkel and Hollande will meet for crisis talks and the ECB faces a crucial decision over its funding lifeline after Greece rejected austerity by 61% to 39%European leaders were scrambling for a response on Monday after a resounding no from Greek voters in a momentous referendum on austerity which could send the country crashing out of the eurozone.