Time running out for Greece to save euro place: EU
07/07/2015 15:20

Cash-strapped and debt ridden Greece faces an uphill battle to retain its place in the euro with European leaders expressing frustration amid the country’s lack of progress over a debt deal with creditors, with the left wing government shunning the latest round of austerity measures crucial to winning a new European bailout.

In response to the results of Sunday’s referendum Euro area leaders on Monday warned Greece to quickly come up with a plan to revive talks with its creditors, meaning that a Greek departure from the Euro area is quite a probable scenario.

Euro area finance ministers and leaders will hold an emergency meeting on Tuesday with German Chancellor Angela Merkel warning that time is running out for Greece to reach a plan to remain a part of the euro while the European Central Bank (ECB) tightened liquidity norms for the cash-strapped Greek banking and financial system.

“The last offer that we made was a very generous one. On the other hand, Europe can only stand together, if each nation takes on its own responsibility”, Merkel said.

Sunday’s referendum verdict showed that 61 per cent of Greeks voiced against further spending cuts and tax hikes imposed by the country’s creditors, pushing Greece into an economic unknown with its euro membership now in limbo.

While the Greek government reckons that the bailout results will give Greece a stronger hand in negotiating for more favourable terms with its creditors, the EU must determine whether the price for bailing out Europe’s most indebted nation time and again is worth it?