Talk of a last-minute deal look over-optimistic as Greece hours away from becoming the first developed nation to default on IMF

With hours before the IMF loan runs out, and a popular vote due on Sunday, this is how events will unfoldGreece managed to put off big payments due to the IMF this month by bundling them together. But time runs out at 11pm BST, when June’s grand total of €1.6bn is due. Greece does not have the money to cover the payment, and that may well mean it defaults on its debt. But the IMF may conceivably agree to a grace period to tide everyone over to Sunday’s referendum.Related: Where did the Greek bailout money go? Continue reading...

After five years, three elections, two bailouts worth $240bn and one ever deepening crisis, Greece is heading for a crunch point on Sunday with a referendum on its future in Europe. We asked Greeks for their view on the troika, the tumult - and whether they want to stay in the euro-zone Continue reading...

Post-election poll of consumer sentiment, showing dramatic uptick in confidence, provides encouraging news for retailers

Germany, France and Italy joined the European commission in insisting that Sunday’s poll is about continued eurozone membershipThe eurozone’s three biggest countries have raised the stakes in next Sunday’s Greek referendum with an orchestrated warning to voters that a no vote would mean exit from the single currency and the return of the drachma.As the Greek economy suffered on its first day of stringent capital controls, politicians from Germany, France and Italy joined the European commission in insisting that the poll was not about whether Athens could secure more favourable bailout terms but was about continued euro membership.Related: Greece in chaos: will Syriza’s last desperate gamble pay off?Related: Greece fiercely divided as referendum campaign gets under wayRelated: Alexis Tsipras must be stopped: the underlying message of Europe's leaders Continue reading...

Less than 10% of the money was used by the government for reforming its economy and safeguarding weaker members of society

Dow, Nasdaq and S&P suffer heavy losses and follows even bigger falls across Europe as debt drama intensifiesUS stock markets on Monday suffered their biggest fall in two years as fears that Greece could drop out of the eurozone spread across the world.The Dow Jones Industrial Average ended the day down 2% to 17,597 points – the biggest one-day fall since June 2013 and wiping out all of the gains made so far in 2015. The Nasdaq andS&P 500 also suffered heavy losses, closing down 2.4% and 2.1%, respectively. Financial and consumer-focused businesses suffered the largest losses. Continue reading...

Greece's prime minister Alexis Tsipras appears in an interview for the country's ERT TV station on Monday, appealing to the Greek people to vote 'no' in the upcoming referendum on Sunday. Tsipras says he does not believe the country's creditors want Greece to leave the eurozone, mainly because the cost of such action would be huge. He adds that the higher the proportion of 'no' votes, the stronger Greece's negotiating hand will become Continue reading...

Protesters acknowledge Greece has a lot to lose if it crashes out of the eurozone, but say it will be worth it if that is what it takes to recover its dignityThe word they all used, without exception, was dignity. Rallying in front of the Greek parliament on Monday night, supporters of the Syriza-led government of prime minister Alexis Tsipras demanded an end to the “economic asphyxia” and “social catastrophe” of austerity – and the return of dignity.Related: Polarising effects of Greece bank closures felt by businesses Continue reading...

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Caught between a history of resistance and defiance and fears of being cast out of the eurozone, Greeks are facing a dilemma of immense proportionsGreece’s fate hangs in the balance, its government is on the line and its people face a dilemma that no nation would want to confront.Did Alexis Tsipras, the firebrand leftist in power in Athens, really intend this? Was his decision to call a referendum impetuous or even bone-headed? Or was Europe’s first democratically elected anti-austerian playing at such dark arts when he decided to put the terms of further financial assistance to the popular vote, that he will ultimately go down as a master tactician?Related: Joseph Stiglitz: how I would vote in the Greek referendumRelated: Alexis Tsipras must be stopped: the underlying message of Europe's leaders Continue reading...

Over the past five years, the EU and the IMF have imposed unprecedented austerity on Greece. It has failed badly. The economy has shrunk by 26%, unemployment has risen to 27%, youth unemployment to 60% and the debt-to-GDP ratio jumped from 120% to 180%. The economic catastrophe has led to a humanitarian crisis, with more than 3 million people on or below the poverty line (The moral crusade against Greece must be opposed, Opinion, 29 June).Against this background, the Greek people elected the Syriza-led government on 25 January with a clear mandate to put an end to austerity. In the ensuing negotiations, the government made it clear that the future of Greece is in the eurozone and the EU. The lenders, however, insisted on the continuation of their failed recipe, refused to discuss a writedown of the debt – which the IMF is on record as considering unviable – and finally, on 26 June, issued an ultimatum to Greece by means of a non-negotiable package that would entrench austerity. This was followed by a suspension of liquidity to the Greek banks and the imposition of capital controls. Continue reading...

While shopkeepers, bar and restaurant owners struggle to make ends meet before banks reopen, supermarkets and petrol station owners see roaring trade“It’s been crazy today,” said the attendant reaching for the dispenser nozzle, as yet another car pulled into the forecourt of the little petrol station in the backstreets of northern Athens. “We haven’t stopped working. It’s been worse even than on Saturday.”Her problem on Monday may have been too many customers. But for Giorgos Chronopoulos, owner of the Eiyo sushi bar in well-off Erythrea, it was just the opposite. “So far today, my profits are down 30%,” he said. “On Sunday, they were 50% down and on Saturday 40%.” Continue reading...

Ahead of the referendum, the fear is not just of collapse, but of a return to the nightmare of the nation’s violent historyBack in the autumn of 2011, I sat in an Athens restaurant with an old acquaintance, a cosmopolitan man who works in the arts. The crisis had begun to bite, though we had no idea then how bad it was going to get. We could hear chanting from Syntagma Square: there was a general strike against the first bailout memorandum. “I don’t feel close to those people,” my dinner companion said. “There’s a civil war going on. It’s not fighting in the streets – yet. But it will become like that. I don’t recognise those people as my compatriots.”Greeks are preparing to vote in a referendum ostensibly on whether to accept the creditors’ latest conditions for extending the country’s bailout. But in these lurching, seasick days, everything is uncertain. Greek banks are closed; the markets are plummeting; Jean-Claude Juncker has declared his love for the Greek people. The bailout programme expires tomorrow; it’s not clear if the offer will even be on the table after that. And assuming we get to this vote on a no-longer-valid document, nobody knows what happens next if the country says no – or yes.Joining the EU in 1981 sealed the end of those terrible years. It meant democracy, enlightenment values, human rights Continue reading...

Pier Carlo Padoan assures nation they are in a stronger position than their eurozone counterparts thanks to their ‘huge but sustainable public debt’Italy’s finance minister has sought to reassure Italians that they would not be following in Greece’s footsteps, saying that the European Central Bank (ECB) would stop any contagion in its tracks.“Let me remind you that we are not in 2011 anymore,” said Pier Carlo Padoan, in an interview on Monday in Corriere della Sera, Italy’s largest daily newspaper.The point is: greek referendum won’t be a derby EU Commission vs Tsipras, but euro vs dracma. This is the choice.I hope the Greek people call Mr. Juncker's bluff. Continue reading...

The banks are closed, the bailout referendum is looming – and Europe’s only far-left government is struggling to hold on to its mass support. In less than a week, it will either be triumphant or finishedIf it all ends on Monday, with the Greeks voting for austerity in order to keep the euro, the first far-left party to hold office in modern Europe will be judged by its critics a failure.By calling a referendum, Syriza has gambled that it can strengthen its hand in negotiations with its lenders. But with no extension to its bailout programme, and emergency funds from the European Central Bank (ECB) on a knife-edge, the move has prompted this week’s “bank holiday” and the rationing of cash at ATMs. Continue reading...

Germany’s vice-chancellor has become the first senior EU politician to voice the private views of many - that the Greek PM is a threat to the European orderOne day before Greece’s bailout ends and the country’s financial lifeline melts away, Europe’s big guns have lined up one after another to tell the Greeks unequivocally that voting no in Sunday’s referendum means saying goodbye to the euro.There was no mistaking the gravity of the situation now facing both Greece and Europe on Monday. Leaders were by turns ashen-faced, resigned, desperate and pleading with Athens to think again and pull back from the abyss.Related: Joseph Stiglitz: how I would vote in the Greek referendumRelated: 'Like a bad dream' – Greeks awake to no money and no certainty Continue reading...

Neither alternative – approval or rejection of the troika’s terms – will be easy, and both carry huge risksThe rising crescendo of bickering and acrimony within Europe might seem to outsiders to be the inevitable result of the bitter endgame playing out between Greece and its creditors. In fact, European leaders are finally beginning to reveal the true nature of the ongoing debt dispute, and the answer is not pleasant: it is about power and democracy much more than money and economics.Related: Greece debt crisis: Europe says referendum is euro vs drachma - live Continue reading...

Stock markets tumble around the world as Athens closes banks for a week and orders capital controlsShare prices have slumped across Europe as Greece shuttered its banks and severely limited cash withdrawals ahead of a referendum on 5 July.

On Friday eurozone officials were still hopeful of a weekend deal - on Sunday night the Greek government closed the banks for a weekGreeks woke on Monday to closed banks after a weekend that has shaken Europe’s single currency and pushed down stock markets.How did it come to this? We look back over the events of the last three days.Related: Greece debt crisis: Europe says referendum is euro vs drachma - liveCapital controls within a monetary union are a contradiction in terms. The Greek government opposes the very concept. Continue reading...

Party leadership contender among 19 Labour MPs to write to David Cameron asking him to show banks ‘we won’t keep bailing them out for reckless lending’The Labour leadership contender Jeremy Corbyn is among 19 Labour MPs who have called on David Cameron to take steps with other European leaders to cancel Greece’s debt as a “signal to the banks and financiers that we won’t keep bailing them out for reckless lending”.A letter, published in the Guardian, was also signed by the Trades Union Congress and Unite general secretaries and MPs including Diane Abbott, who is standing for the party’s nomination to be London mayor, Michael Meacher and John McDonnell.Related: Shares slide as deepening Greek crisis shakes global marketsRelated: Greek crisis brings eurozone to a crossroads | Letters Continue reading...

Analysts from Barclays, Bank of America Merrill Lynch, Fidelity and BNY Mellon assess weekend that sent the euro and shares plummetingAfter dramatic developments in Greece over the weekend sent the euro falling, shares tumbling and forced up yields on some government bonds, City analysts have put out a range of views on whether the country can stay in the single currency and the how markets might react if it crashed out.

Greece is the word on many holidaymakers’ lips, as they weigh up the best ways to avoid difficulties given the continuing economic turmoil. We look at the best courses of actionWithdraw a large amount of euros in cash before heading to Greece (and avoid it all being in high denomination notes). The official advice from the Foreign Office is: “Make sure you have enough euros in cash to cover emergencies, unforeseen circumstances and any unexpected delays.”Related: Tourists in cash-strapped Athens grab a fistful of euros just in case Continue reading...

Share prices slump after Athens orders banks shut until after Sunday’s snap referendum, with stock exchange closed on Monday and ATM withdrawals limited to €60Greek crisis: follow today’s live updatesShare prices slumped across Europe on Monday as Greece shuttered its banks for a week following a fateful weekend that has shaken Europe’s single currency.The Greek government decided on Sunday night it had no option but to close the nation’s banks the following day after the European Central Bank (ECB) raised the stakes by freezing the liquidity lifeline that has kept them afloat during a six-month run on deposits.Related: Greek crisis: stock markets slide after capital controls imposed - live updatesRelated: Greek debt crisis: the key points of Athens bank controlsRelated: The Greeks for whom all the talk means nothing – because they have nothingRelated: The Guardian view on Greece and the euro: no money left | Editorial Continue reading...

Unverified report tells Caribbean nation it ‘faces hard times’ and ‘a crisis looms’ and it must restructure debts to bridge coming financing gapsThe struggling Caribbean island Puerto Rico needs to restructure its debts to bridge financing gaps in coming years, in what could be a precedent-setting move, according to a copy of a report by former IMF economists posted on websites of the island’s media.

Markets across Asia slide and $35bn is wiped from Australian stock market on what is expected to be a torrid day following the closure of Greek banksMarkets suffered across Asia on Monday as Greece shut down its banks for a week ahead of an increasingly likely debt default.Oil prices declined and the euro edged down against the dollar, while Tokyo’s Nikkei 225 index fell 2% to 20,283.98 points. The Shanghai Composite Index was off 0.4% at 4,178.56 despite China’s surprise weekend interest rate cut.Related: Greek debt crisis: the key points of Athens bank controlsRelated: Australian shares plunge as $35bn wiped off stock market over Greek crisis Continue reading...

All banks closed for at least a week, cash withdrawals capped at €60 a day and foreign money transfers banned ahead of referendum on bailout termsEarly on Monday morning, the Greek prime minister, Alex Tsipras, published a decree in the official government gazette setting out the capital controls to be imposed on the country.The decree – entitled ‘Bank Holiday break’ – was signed by Tsipras and president Prokopis Pavlopoulos.The same applies to the payment of wages and pensions--they are also guaranteed. #Greece Continue reading...

Report on island’s financial stability by former IMF economists has the potential to rattle bond prices if its predictions are pessimisticPuerto Rico is set to release a key report by former IMF economists on its financial stability on Monday, which could point towards a fix for the island but has the potential to rattle bond prices if its predictions are pessimistic.Puerto Rico, struggling with a $73bn debt load and faltering economy, is facing crunch time this week with a deadline to agree on a budget as well as a 1 July deadline to make a $655m payment on its general obligation debt, while its struggling utility Prepa (Puerto Rico Electric Power Authority) faces a $400m payment.Related: Puerto Rico in crisis: weighed down by $73bn debt as unemployment hits 14% Continue reading...

As the Abbott government gets set to unveil Australia's new target for greenhouse gas reductions after 2020, Lenore Taylor asks Professor Ross Garnaut and Frontier Economics managing director Danny Price: how do we intend to reach the target? Continue reading...

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Greek banks will not open until July 7 in an attempt to avoid financial panic, after ECB capped the emergency funds keeping them running

Following news banks will remain closed until after Sunday 5 July referendum, people all over the city are desperate to access their moneyAll over Athens they were queuing, but the lines outside the National Bank branches were by some distance the longest – because the National Bank supplies the banknotes, and lots of other Greek banks, by midnight on Sunday, had no more of those.“People are feeling very concerned … very insecure,” said Maria Poulimeniou, outside the National Bank on Eleftherios Venizelos street in Kallithea, a southern Athens suburb. Continue reading...

Deadlines have come and gone before, but Tsipras’s referendum pledge has finally forced a denouement. Creditors must rethink a failed austerity policy, and the political risk of painting themselves as the enemies of the Greek peopleSomething was bound to snap in Greece, and now it has. Over six years, jobs have vanished, hope has been smothered and a generation of progress in living standards has been reversed. Suicides soared among stricken individuals, and the collective sense of sovereignty shrivelled. The nation has been crucified on the cross of a currency that it should never have been allowed to join. It awakes to discover the extent of restrictions on accessing its bank accounts.Step back from the immediate row over proposals and counter-proposals, under which Alexis Tsipras drew a sharp line on Friday with his midnight pledge for a referendum, and this is the real backdrop to Athens’s abrupt decision to stop playing the European game. Fiery and inexperienced, the Greek prime minister has breached all the rules of diplomacy, failing to warn his counterparts about his plebiscite before going public, and perhaps depriving himself of a last bit of leverage in the haggling over bailout terms. His rhetoric contrasts his own mandate with the presumptions of callous technocrats, ignoring the mandates of creditor governments. That threatens the space in which a European club of 28 members is fated to find compromise. And the question he will put to the voters – whether they accept the creditors’ terms for extending a bailout that is now set to finish five days before Sunday’s vote – is arguably a nonsense.Related: Greece crisis deepens as banks close for a week after weekend that shook euro Continue reading...

We call on David Cameron to support the organisation of a European conference to agree debt cancellation for Greece and other countries that need it, informed by debt audits and funded by recovering money from the banks and financial speculators who were the real beneficiaries of bailouts (Greek leader calls last ditch referendum on bailout, 27 June). We believe there must be an end to the enforcing of austerity policies that are causing injustice and poverty in Europe and across the world. We urge the creation of UN rules to deal with government debt crises promptly, fairly and with respect for human rights, and to signal to the banks and financiers that we won’t keep bailing them out for reckless lending.

For Georgios Karvouniaris, his sister Barbara, and many thousands like them, whether Greece stays in the eurozone or not is unlikely to have any effectOn a steep, gardenia-scented street in the north-eastern Athens suburb of Gerakas, in one corner of a patch of bare ground, stands a small caravan.Plastic mesh fencing – orange, of the kind builders use – encloses a neat garden in which peppers, courgettes, lettuces and beans grow in well-tended raised beds. Flowers, too.Related: Greece crisis: a disaster for Athens and a colossal failure for the EURelated: The moral crusade against Greece must be opposed | Zoe WilliamsRelated: Greece crisis could be a Sarajevo moment for the eurozone Continue reading...

Warning about potential bank closures echoes similar advice issued in the US and Australia as European Central Bank caps emergency funds to countryThe Foreign Office has updated its advice for those travelling to Greece with a warning that access to banking services in the country may become limited at short notice.The change in advice comes as Greece teeters on the brink of defaulting on its debts, which could trigger an exit from the euro or the closure of the banking system. Continue reading...

After three crises in as many days, the collective performance of the eurozones governments inspires little hope or confidence in their crisis managementFive years from its inception, the world’s biggest bailout of a sovereign state will grind to an excruciating halt on Tuesday, theoretically leaving Greece high and dry and on its own under a leftwing government bitterly accusing the EU elite of deliberately using the country as a neo-liberal laboratory.If the experiment has been a disaster for Greece, it is also a colossal failure for Europe, with the result that at the very apex of leadership the EU nowadays resembles an unhappy assembly of squabbling politicians locked in what could not be called an “ever closer union”. Continue reading...

The idea that Greece partly deserves its fate reflects an order in which wealth trumps democracy. We should fight a narrative that enfeebles us all‘This is our political alternative to neoliberalism and to the neoliberal process of European integration: democracy, more democracy and even deeper democracy,” said Alexis Tsipras on 18 January 2014 in a debate organised by the Dutch Socialist party in Amersfoort. Now the moment of deepest democracy looms, as the Greek people go to the polls on Sunday to vote for or against the next round of austerity.Unfortunately, Sunday’s choice will be between endless austerity and immediate chaos. As comfortable as it is to argue from the sidelines that maybe Grexit in the medium term won’t hurt as much as 30 years’ drag on GDP from swingeing repayments, no sane person wants either. The vision that Syriza swept to power on was that if you spoke truth to the troika plainly and in broad daylight, they would have to acknowledge that austerity was suffocating Greece.Related: Greek crisis live: Banks to stay shut on Monday - reportsAt the moment, Germany knows best. How do we know they know best? Because they are the richest Continue reading...

BIS says governments needed to rely less on monetary policy and more on structural reform to secure sustainable growthThe international body that represents the world’s central banks has issued a stark warning that an unprecedented period of ultra-low interest rates mask deep weaknesses in the global economy and threaten to be the trigger for the next financial crisis.In its annual report, the Basle-based Bank for International Settlements says that what used to be considered “unthinkable” risks becoming the “new normal”, with clear risks for future stability. Continue reading...

Wages are rising again: but families who turned to the Tories in May will not forgive a government that rewards their votes with a net fall in incomeNext year, average wage rises will double to 4% and the economy will be booming. Exports will flourish and private investment will return to pre-crisis levels. Unconfined joy will spread from the south-east northwards, and west to the Cornish constituencies captured by the Tories from the Liberal Democrats.The optimistic forecasts do not stop there. Unemployment will continue to fall, productivity will rise, and the Bank of England, concerned that the UK’s runaway success is about to generate the return of inflation, will start to put up interest rates at a gentle pace.Middle income families are spending only a proportion of their gains from a 2% wage rise. They are clearly nervous Continue reading...

As George Osborne makes his welfare cuts, the response from the party does not necessitate a great lurch to the rightThere is decency left in public life after all! In the course of an evening at the Mansion House in which he announced some bizarre budgetary targets, George Osborne found the time to pay a warm tribute to his long-time antagonist, former shadow chancellor Ed Balls. Not only that: there was spontaneous applause in honour of the man who, but for the unexpected result of the election, would have been standing in Osborne’s place, unveiling a somewhat more appealing economic strategy.As my dear friend the late Alan Watkins used to say: “Politics is a rough old trade.” But I have noticed since the election that the dignitaries of the City of London are not alone in expressing, alas somewhat belatedly, their admiration for Mr Balls.There has been much coverage about the Tories' £12bn of welfare cuts; rather less of the £8bn of tax cuts Continue reading...

With the country edging closer and closer towards default, our panel examines the current stalemate, the factors behind the crisis and what Greece can do nextThe shock decision of Alexis Tsipras to call a snap referendum for 5 July, just like the socialist prime minister George Papandreou had tried to do in 2011, has torpedoed any chance of reaching an agreement this weekend. Greece will almost certainly default, or at least will get into arrears if it refuses to – or simply can’t – pay the 1.6bn euros it is due to the International Monetary Fund on 30 June.Related: EU ministers refuse bailout extension for Greece as referendum loomsInsisting on the status quo full of more austerity produced an increasingly weaker Greece Continue reading...

Euro finance ministers have refused to extend Greece’s bailout following shock decision to hold a referendum

Extensive Guardian analysis of eurozone meetings shows ministers spent a lot of the last five years talking about cash-strapped countryAt least 87* separate EU summits and meetings have been partly or entirely devoted to Greece and its financial crisis over the past five years, for only fitful progress on resolving the basic issue, a Guardian analysis reveals.With European finance ministers meeting once again in Brussels on Saturday to discuss the Greek debt crisis, scrutiny of European commission documents and archive news reports has found nearly 90 separate days where EU heads of government or finance ministers met to agonise over the debt crisis or chew over various bail-out and reform plans. Continue reading...

Alexis Tsipras says government will campaign for no vote as Athens tells finance ministers in Brussels that Greek people need to decide country’s futureGreece has closed the door on attempts to resolve the bailout crisis by announcing a snap referendum, a senior eurozone minister has said.Jeroen Dijsselbloem, president of the Eurogroup of finance ministers for the single currency, said he was disappointed by the surprise plans to stage a popular vote on debt financing proposals. Continue reading...

Prime minister returns from Brussels and tells Greece that terms offered by creditors ‘clearly violate the European rules’In a dramatic move that will put Europe on tenterhooks, the Greek prime minister Alexis Tsipras told his fellow citizens last night he would call a referendum on the bailout accord that international creditors have proposed to keep the debt-stricken country afloat.