Hopes 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.
“The no result unfortunately widens the gulf between Greece and other eurozone countries,” said Valdis Dombrovskis, the most senior European official in charge of the euro. “There is no easy way out of this crisis. Too much time and too many opportunities have been lost.”
Dombrovskis said “Greece is and remains part of Europe”, but declined to say whether that included being in the euro.
Greece had received €184bn (£130bn) in bailout funds since 2010, he said, adding that the no result made finding a solution more complicated. “In the euro area we have 19 democracies, not only one democracy,” said Dombrovskis, a former prime minister of Latvia, one of the newest entrants to the currency union.
The German chancellery warned that conditions for new talks with Greece had not been met.
“The government takes notice of the clear no vote and respects it,” Angela Merkel’s spokesman, Steffen Seibert, said. “However, in light of the decision by the Greek citizens, the conditions to start negotiations on a new aid programme are not met yet.”
Merkel will head to Paris for crisis talks with her counterpart François Hollande, in an effort to forge a common Franco-German response, setting the stage for an emergency summit of all 19 eurozone leaders on Tuesday.
Time is fast running out for Greece, with its banks almost out of money. Daily withdrawals remain capped at €60, but some people can get no more than €50, ostensibly because €20 notes have run out.
The Greek government promised that banks will reopen on Tuesday, but this looks increasingly unlikely, as the European Central Bank is expected to withhold further emergency funding when it meets later on Monday.
According to Greek television, the country’s prime minister, Alexis Tispras, is taking a break from marathon meetings with party leaders to take a call with the Russian president, Vladimir Putin.
“We treat with respect the voice raised during the plebiscite,” Putin’s spokesman said.
Greece might be discussed on the sidelines of a Brics summit in Ufa, in the Russian federal republic of Bashkortostan , on Wednesday, bringing together leaders from Brazil, Russia, India, China and South Africa.
The tough line from Berlin and Brussels underscores how a north-south divide is emerging in Europe over how to deal with the crisis.
Governments, including Germany, Slovakia and Finland, want Greece to sign up to tough reforms in exchange for financial aid. But southern European countries have struck a more emollient tone.
Italy’s foreign minister, Paolo Gentiloni, has called for talks to resume. “There is no escape from the Greek labyrinth with a Europe that is weak and without growth.” Spain’s finance minister, Luis de Guindos, said everyone wants Greece to stay in the euro, although a no vote made the situation more complicated.
Spain’s governing People’s party, which faces a challenge from the insurgent Podemos movement in elections later this year, is treading carefully, as it has used Greece’s plight to justify its own austerity policies.
The leader of Podemos, Pablo Iglesias, welcomed the referendum result: “The citizens of Greece have said that austerity isn’t the way to end the economic crisis.”
The EU establishment blames Greece’s radical left government for deepening the economic crisis since it came to power in January, an argument that Dombrovskis reiterated.
“Only eight months ago Greece was ready to turn the page,” Dombrovksis said. “Regrettably the current Greek government was not able to use this extension [on its bailout] to produce a credible strategy to come out of this crisis, regain financial stability and return to economic growth.”
This echoed the verdict of the International Monetary Fund, which slammed the Tsipras government for failing to reform the economy, in a policy paper that warned Greece would need debt relief and a new bailout worth €60bn.
Denying reports that the European commission had tried to suppress this report, Dombrovskis sought to turn the focus back on Athens and its failure to stick to the terms of previous bailout programmes.
He repeated earlier criticism that the vote was “not correct” because Greeks had voted on a package that had already expired.
This article was written by Jennifer Rankin in Brussels, for theguardian.com on Monday 6th July 2015 14.05 Europe/Londonguardian.co.uk © Guardian News and Media Limited 2010