The emergency measures were agreed at a cabinet meeting after a gathering of Greece’s systemic stability council, called after Eurogroup <g data-gr-id="58">eurozone</g> finance ministers refused to extend its bailout beyond Tuesday, sparking default fears over an IMF loan repayment due the same day.
The European Central Bank (ECB) subsequently left itsEmergency Liquidity Assistance (ELA) financial lifeline for Greek banks unchanged on Sunday.
“This decision (by Eurogroup) led today the ECB not to raise ELA for the Greek government and made the Bank of Greece ask for the activation of measures of bank holiday and restriction of bank withdrawals,” Tsipras said in a statement that also called again for an extension to Greece’s current bailout programme.
The Greek stock market will also remain closed on Monday as part of measures designed to prevent fresh panic. Ahead of the announcement, Greeks raced on Sunday to find functioning cash machines in an increasingly anxious run on the banks, as speculation mounted over impending drastic restrictions.
“It’s more than obvious that this (Eurogroup) decision has no other goal than to blackmail Greek people ... and to raise obstacles to the democratic process of the referendum,” Tsipras added
in the statement.
“People’s deposits are safe, totally safe. Equally safe is the reimbursement of salaries and pensions.
“Any difficulties that may arise must be dealt with calmness. “The more calm we are, the sooner we will get over this situation.”
Tsipras added that he had again asked for “the prolongation of the programme this time from the president of the European Council and the 18 leaders of the other eurozone member countries, as well as the chief of ECB, the Commission and the European Parliament.”
What precipitated this crisis?
Greece became the epicenter of Europe's debt crisis after the Wall Street meltdown in 2008. With global financial markets still reeling, Greece announced in October 2009 that it had been playing down its deficit figures for years, raising fears about the soundness of Greek finances. Suddenly, Greece was shut out from borrowing in the financial markets. By the spring of 2010, it was heading toward bankruptcy, which threatened to spark a new financial crisis. To avert calamity, the so-called troika: the IMF, the European Central Bank and the European Commission issued the first of two international bailouts for Greece, which would eventually total more than 240 billion euros, or about $264 billion at current exchange rates.