Greek Finance Minister, Varoufakis, resigns | Independent Newspapers Limited
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Greek Finance Minister, Varoufakis, resigns

Posted: Jul 6, 2015 at 11:33 am   /   by   /   comments (0)

THE Greek Finance Minister, Yanis Varoufakis, on Monday July 6 2015 morning resigned his appointment.

His resignation was unexpected, as Greek voters overwhelmingly rejected the latest bailout package from European creditors in a referendum on Sunday July 5.

Varoufakis, who has been finance minister since January, had been rallying support for a “No” vote leading up to the referendum, and said that he would step down if the Greek people voted “Yes” to further austerity.

According to preliminary figures from the Greek government, 61 per cent of Greeks voted “No” (Oxi) to a bailout package that would enforce greater austerity measures, while 39per cent voted “Yes.”

The New York Times stated that Varoufakis’ surprise resignation “appeared to be the first move at conciliation toward Greece’s creditors by the government of Prime Minister, Alexis Tsipras,” who is expected to announce more changes to the Greek cabinet on Monday.

Varoufakis wrote on his blog: “I was made aware of a certain preference by some Eurogroup participants, and assorted ‘partners’, for my… ‘absence’ from its meetings; an idea that the Prime Minister judged to be potentially helpful to him in reaching an agreement. For this reason I am leaving the Ministry of Finance today.

“I consider it my duty to help Alexis Tsipras exploit, as he sees fit, the capital that the Greek people granted us through yesterday’s referendum. And I shall wear the creditors’ loathing with pride.”

The landslide victory for the “No” campaign was a major surprise. Athens exploded in celebration over the result, with thousands streaming into Syntagma Square, waving Greek flags, chanting, and setting off fireworks.

Now that Greece has voted “No,” this means that negotiations start all over again between the Syriza-led government and European creditors.

Most bank analysts had warned that a “No” vote would likely to lead to Greece defaulting on almost all its remaining debt. They add that the country would run out of money because the European Central Bank would not lend the country anymore cash.

Barclays’ analysts said in a note last night that this would mean Greece would run out of liquidity as of July 20, and therefore certainly default on its debt, maybe exit the EU, abandon the euro and therefore would re-adopt its old currency, the drachma and use IOUs to recapitalise its banking system

Meanwhile, as European creditors were set to hold an emergency summit on Monday, Greece would keep its banks closed and cut the cash withdrawal limit, according to IHS Global Insight’s senior economist, Diego Iscaro.