Greece votes no to referendum; big challenge awaits Eurozone

The problems in Greece seems to be never ending as the nation has voted by a big margin against Europe’s latest bailout offer, raising the prospect that the country could now suffer the worst economic disaster and lose its place in the eurozone. The people of Greece seem to be supporting their government’s stand as thousands of them could be seen celebrating on the streets after the nation voted “no”. The Prime Minister, Alexis Tsipras hoped that Europe would hand over more money with less austerity attached and would also cancel Greece’s enormous debts.

Greece votes no to referendum (Representation Image)

Rejecting the offer means that Greece is now on an uncertain path which could lead to its exit from Eurozone and it would end up printing its own currency. The impact of this on the economy of Greece would be devastating. The situation in Greece is quite tricky as the government needs cash immediately to reopen the banks that have been shut down for about a week. It also needs to start rolling out the wages and pensions of the people.

This is not the first time that Greece has been in need of money; both the Eurozone and the International Monetary Fund have previously rescued Greece twice since 2010. Over the period, Greece has been helped with loans totaling over $240 billion. Greece has already missed its deadline to pay the IMF back and now they’ve rejected the Eurozone’s offer.

The other European leaders have condemned the step taken by Greece and said that the vote would destroy any basis for talk, because it would show that Greece was not willing to co-operate with them to put its finances in order and keep the economy on track. German chancellor Angela Merkel was due to meet the French President Francois Hollande on Monday in context of the matter. On Monday, the Greek Finance Minister, Yanis Varoufakis resigned stating that the European negotiators had told Greece that they would prefer him not being present for the negotiations. Greek Prime Minister said that Greece did not want to leave the Eurozone but it wants a better deal from them.

As of now, it is not clear who will prevail. Greece needs lesser taxes and cuts but the Eurozone is adamant for them. They had also hoped for a yes vote. After five months of negotiations, both the sides have reached a stalemate. Sure, there have been a series of dialogue and comments being exchanged but only time will tell if Greece will remain a part of the Eurozone or not.