Sunday 23 October 2016

Europe is heading into uncharted waters - Noonan

Minister disappointed as Greece calls referendum

Tom Molloy

Published 28/06/2015 | 02:30

Michael Noonan: 'I don't know what the next week holds. It is impossible to speculate. We are going into totally uncharted waters'
Michael Noonan: 'I don't know what the next week holds. It is impossible to speculate. We are going into totally uncharted waters'
ALL GREEK: Greek Finance Minister Yanis Varoufakis holds a news conference during a Euro zone finance ministers emergency meeting on the situation in Greece in Brussels yesterday

Europe is entering "uncharted waters" following the Greek government's decision to call a referendum on further austerity next weekend, Finance Minister Michael Noonan warned in Brussels.

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A relaxed-looking Mr Noonan complained to throngs of journalists yesterday that it was the fifth time in just 10 days that he had flown to either Brussels or Luxembourg to discuss Greek-related matters.

He added that there had been room for a deal until the television announcement by Prime Minister Alexis Tsipras in the early hours of yesterday when he told Greeks about the surprise vote.

"I found out at 12 midnight last night that the Greeks have unilaterally discontinued negotiations. I am disappointed with that," Mr Noonan said. "I don't know what the next week holds. It is impossible to speculate. We are going into totally uncharted waters."

His comments were echoed by other finance ministers. Jeroen Dijsselbloem, the Dutch finance minister who chairs the committee of eurozone finance ministers, said the Greek government had ended any hopes of a negotiated deal.

"It has closed the door on further talks while the door was still open, in my mind." German finance minister Wolfgang Schaeuble said the negotiations had clearly ended and there were "no grounds for further discussions".

The decision to call a snap referendum prompted concern but no panic in Greece yesterday.

Some Greeks questioned whether the referendum was legal because the Greek constitution stipulates that referenda are not allowed on fiscal issues.

With most Greek banks closed for the weekend, there was no sign of panic on the streets of Athens. Government officials said there was no plan to impose capital controls that would limit withdrawals.

But police tightened security around ATMS as queues formed at some machines in the darkness almost as soon as Tsipras's early hours televised speech was finished.

The Bank of Greece said it was making "huge efforts" to ensure the machines remained stocked. One branch of Piraeus bank that is normally open on ­Saturdays was shut, with 100 people queued outside. A senior executive said the plan was to open the branch but staff were weighing security concerns because of the queue.

Long queues were also reported in some supermarkets in Athens as people stocked up with supplies. However, along with the worry, there were also signs of defiance and almost relief after years of relentless austerity and seemingly endless rounds of crisis meetings with lenders.

Greek Interior Minister Nikos Voutsis called for calm, telling deputies: "The game is not over for the country, its people, this parliament."

Without a clear agreement on bailout cash, Athens is set to default on €1.6bn of debt to the International Monetary Fund on Tuesday.

Its stricken banks have depended on emergency liquidity from the European Central Bank to stay open, and the banking system faces at the very least a further flood of withdrawals after billions have left in recent weeks.

(Additional reporting Reuters)

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