The resounding rejection of an international bailout deal by voters in Greece raised fears Sunday of the collapse of the country’s banking system, a catastrophic government default, an eventual exit from the euro and potential social unrest. In a surprising 61% to 39% result, Greeks said “no” in a referendum on a rescue package that would have kept their debt-ridden country afloat but subjected it to additional austerity measures. The landslide delivered a sharp rebuke to European Union leaders who had warned that the plebiscite was, in effect, a vote on whether Greece wanted to remain a member of the Eurozone, the group of 19 nations that share the euro currency. The EU is now confronted with one of the gravest challenges to its mission of “ever closer union” between member states.
Jubilant crowds of “no” voters thronged Athens’ main square into the early hours of Monday to celebrate what they said was a chance for Greece to reassert itself and achieve a better deal from creditors. Motorists honked their horns, and triumphant chants of “Oxi! Oxi! Oxi!” — “No! No! No!” in Greek — rose in the balmy Mediterranean air.
But there were already signs of a backlash from angry European officials that could make any new bailout agreement even more difficult. If a deal is not struck quickly, Athens could find itself broke, forcing it to default on its debts and triggering a slide out of the Eurozone.