Greece could be facing a euro referendum

Greece may have to call referendum

Greece could call a referendum or have early elections should its eurozone partners reject its debt and growth plans, Greek finance minister Yanis Varoufakis said in a newspaper interview yesterday.

The new Greek government, led by Alexis Tsipras, won an election in January promising to renegotiate a bailout agreed with the International Monetary Fund and its European Union partners that requires strict budget discipline and sweeping economic reforms.

The government reached a temporarily deal with its lenders last month and Athens has until the end of April to specify the reforms it will make in exchange for further aid.

Eurozone finance ministers are meeting today in Brussels to discuss a letter of pledged reforms sent by Athens last week.

Should Brussels ultimately reject Greece’s proposals, Varoufakis told Italian daily Corriere della Sera: “There could be problems. But, as my prime minister has said, we are not yet glued to our chairs.

“We can return to elections, call a referendum,” he said.

He did not say what the referendum would be on. However, there has previously been speculation that an impasse might force the Greek government to hold a public vote on whether to continue to accept EU strictures, a move that could raise questions about Greece’s place in the eurozone.

In the newspaper interview, Varoufakis said that the response so far by eurozone partners to his proposals to replace its current debt with bonds linked to nominal growth is “silence.”

Reuters