Euro zone finance ministers are set to hold an emergency conference call on Wednesday after Greek prime minister Alexis Tsipras contacted Brussels on Tuesday seeking a third bailout for his country.
As Europe waits for euro finance ministers to hold their emergency conference call at 3.30pm (Irish time), the world's media have been busy weighing in on whether Greece should be granted this third bailout ahead of Sunday's proposed referendum.
The Telegraph
Jeremy Warner writes that Greece's predicamentwas caused by the "madness of the single currency" and says the euro was launched "before any of the defining characteristics of successful monetary union had been put in place".
“In economic terms, the euro is little more than a glorified fixed exchange rate system. All such arrangements are ultimately doomed.”
“Unfortunately, it is proving extraordinarily difficult and troublesome to admit these truths, which is why whatever is eventually cobbled together to prevent Greece from leaving can never be a lasting solution.”
“Genuine federalism is, at best, decades away, and in the meantime, what is Europe to do; simply stagger from one economically debilitating crisis to the next? This is the all too likely prospect.”
The Guardian
In an editorial in the Guardian's Comment is free section, the UK paper writes that this Sunday will mark a "make-or-break moment", not only for the euro zone but for the EU itself.
“The rhetoric coming from Athens is as heated, where there is talk of European “blackmail” against the free will of Greek voters, as if Europe’s creditor nations don’t have voters of their own,” it writes.
"Unless a last-minute deal can be reached between Greece and its creditors, the only thing that can be hoped for is serious damage limitation. In the worst-case scenario of a Greek exit from the euro, it would pile disaster upon disaster if the country were to leave the European Union. Europe must stare into this abyss to prevent itself from falling into it."
The Chicago Tribune
The US newspaper writes that by failing to repay the roughly €1.6 billion, Greece had become the first developed country to fall into arrears on payments to the International Monetary Fund.
“As Greece’s leaders pushed new terms for a possible third bailout, they also struggled to cope with the consequences of shutting banks and the stock market this week.
“Authorities and citizens alike braced for long lines as a thousand bank branches around the country were ordered to reopen Wednesday to help desperate pensioners without ATM cards cash up to €120 from their retirement checks. The elderly have been hit particularly hard, with tens of thousands of pensions unpaid as of Tuesday afternoon.”
The Financial Times
The Times reports that the British government is taking action to ensure recipients of the state pension in Greece will continue to receive their payments despite the restrictions placed on the country's banks.
The British government said on Tuesday it was trying to contact those drawing a British state pension from a Greek bank account to help them switch to a non-Greek account.
“The measure follows a decision by the Greek government to impose capital controls which will see the country’s banks shut until at least July 6th and cash withdrawals limited to €60 a day.
“International payments into Greece are exempt from these restrictions, the Department for Work and Pensions said, adding that UK state pension and public service pension payments would continue to be made into Greek accounts “in the usual way”.”
The Los Angeles Times
In an editorial, Michael Hiltzik writes a Greek default or exit from the Euro zone would be "almost a nonevent for the rest of Europe or the world".
"With an estimated gross domestic product of about $250 billion, the country's economy is about the size of Connecticut or Louisiana," writes Mr Hiltzik. "The default by Greece on its international debt, which formally occurred Tuesday at midnight Central European Time, won't matter much to the bottom line of such major creditors as the European Central Bank.
“Up to now, the Euro zone has been regarded as sacrosanct-there are no established provisions for a country, once in the zone, to leave it.
"If Greece cracks open the door, will other countries that consider themselves disadvantaged by the single currency, such as Spain and Italy, follow it out? Those are much bigger economies, and keeping them in would involve higher costs than the European Community could sustain.
"Even if Greece stays in the euro, its monetary partners would need to take a lesson from the near-death experience. The economies of Greece and Germany are hopelessly divergent, yoked only by the dream of economic union. But if it costs one country so much simply to keep the bankers and bondholders of others solvent, the likelihood is that this crisis won't be the last."
The Times of India
The Indian newspaper writes if Greece goes bankrupt or decides to leave the euro zone, the situation could "create instability in the region and reverberate around the globe".
In an explanation of the Greek debt, the paper writes that the International Monetary Fund did not use the term “default” after Greece missed its payment deadline, but instead “placed the country in so-called arrears”.
“Regardless of the country’s technical status, missing the payment will most likely prove to be a warning that Greece will probably be unable to meet its other obligations in coming weeks to its bond holders and to the European Central Bank. That might make the central bank less willing to continue emergency loans that have been propping up the Greek banking system for the past several weeks.”
It writes that the real deadline could be late July when Greece must pay the European Central Bank €3.5 billion.
“If there is no international bailout program in place by that time, and little chance of such a program being in the works, the central bank at that point would probably have to finally take Greek banks off life support.”
