Greek Referendum on Bailout Too Close to Call, Poll Shows

The battle lines are drawn in Greece. Now the politicians are waiting for the people.

by Nikos Chrysoloras

July 2, 2015 — 10:27 AM EEST

Bloomberg

Greek voters are almost evenly split heading into a referendum in three days that European leaders said could plunge the country into economic darkness.

A GPO poll cited by euro2day.gr said 47 percent leaned toward a “yes” vote, an endorsement of austerity and the international bailout. The “no” camp, the government’s position rejecting those terms, was 43 percent. The margin of error in the survey of 1,000 people was 3.1 percentage points.

The battle lines ahead of the vote appeared immovable after a day of posturing in the wake of the expiry of Greece’s bailout deal and its missing a payment to the International Monetary Fund. Politicians across Europe poured scorn on Prime Minister Alexis Tsipras’s strategy; he said the “no” vote would improve his leverage.

Greece is facing a “terrifying” economic freefall, Spanish Finance Minister Luis de Guindos said. “We can’t have an accord with someone who says ‘no,’” his French counterpart, Michel Sapin, said.

Stocks, bonds and the euro were little changed following yesterday’s gains, which reflected signs of a thaw. The Euro Stoxx 50 Index was up 0.2 percent at 8:22 a.m. in London.

Tsipras Appeal

Tsipras’ appeal yesterday to use Europe’s proposal as a basis for talks was accompanied by his demands. He wants to delay implementation of the zero-deficit clause for retirement funds and other pension reforms until October instead of July and maintain a 30 percent discount on sales tax for islands. He also wants to proceed with changes to collective-bargaining rules that creditors opposed.

Creditors are insistent on pension reforms that would bring savings of as much as 1 percent of gross domestic product by 2016 and immediate steps to eliminate early retirement benefits and allowances for lower pensions.

Meantime, banks are shut for a fourth day and Greek media have begun to speculate that deposits will be seized to bolster their finances. Ta Nea newspaper’s front page blared the bail-in could range from between 27 percent and 55 percent.

In Frankfurt, the European Central Bank maintained its emergency support for Greek lenders following Greece’s failure to repay $1.7 billion to the IMF. The cap, which was frozen after the referendum was called, was kept unchanged.

With Greeks limited to daily withdrawals of 60 euros, the decision by ECB policy makers gives the country more time for a political solution to succeed.

Following reports of his letter to creditors, Tsipras addressed the nation to quash speculation swirling on social media that he might cancel the referendum.

Instead, he doubled down, reiterating his call to reject austerity. He said it would strengthen his bargaining position.

Popular Verdict

“Come Monday, the Greek government will be at the negotiating table after the referendum, with better terms for the Greek people,” Tsipras said in a Twitter message posted as he spoke on national television. “A popular verdict is much stronger than the will of a government.”

Angela Merkel -- Europe’s dominant political figure and his chief adversary -- took it in stride. Asked whether she and Tsipras are still on speaking terms, the German chancellor said the two had talked several times in the last few days.

“Our personal relationship has not been damaged at all,” Merkel told reporters. “We can talk to each other anytime and have done so recently.”