GREECE was last night on the brink of a historic victory for the No vote against the austerity measures demanded by its international creditors, according to the first results.
The country now faces an uncharted future as its interior ministry predicted that more than 60 per cent of voters had rejected the proposal of harsh cuts in exchange for rescue loans.
As news of the results broke, people began pouring into Syntagma Square in Athens to celebrate.
Prime Minister Alexis Tsipras, who was gambling the future of his five-month-old left-wing government on the vote, insisted that a No vote strengthened his hand to negotiate a better deal with creditors, while a Yes result would mean capitulating to their harsh demands.
The opposition has accused Tsipras of jeopardising the country’s membership in the 19-nation club that uses the euro, and said a Yes vote was about keeping the common currency.
The referendum – Greece’s first in 41 years – was held amid banking restrictions imposed last Monday to halt a bank run, with Greeks queuing up at ATMs across the country to withdraw a maximum €60 per day. Banks have been shut all week, and it is uncertain when they will reopen.
Tsipras’s high-stakes brinkmanship with lenders from the eurozone countries and the International Monetary Fund (IMF) resulted in the state defaulting on its debts this week and shutting down its banks to avoid their collapse. He called the referendum last weekend.
“Today, democracy is defeating fear... I am very optimistic,” Tsipras said after voting in Athens.
European officials openly urged Greeks to vote against the Government’s recommendation.
“I hope people say Yes,” European Parliament President Martin Schulz told German public radio. “If, after the referendum, the majority is a No, they will have to introduce another currency because the euro will no longer be available for a means of payment.”
When polling stations opened, opinion polls were split on whether the country’s 9.8 million voters would choose to accept creditors’ proposals for more austerity in exchange for rescue loans.
Capital controls have been in place since last Monday after the European Central Bank ruled against granting Greece further emergency funding.
Its current bailout expired the following day and Greece also failed to make a €1.6 billion (£1.1bn) payment to the International Monetary Fund (IMF).
Voter Alkiviadis Kotsis, a gym teacher, said he was voting No because the country could not endure further austerity.
He said: “No matter how many loans you take, you cannot get by if you don’t produce things. You can’t do anything.”
Meanwhile, 22-year-old Aris Spiliotopoulos was backing Yes to prevent his country from leaving the European Union.
He said: “I am voting Yes because I believe that my future and even my kids’ future in 20 or 30 years’ from now is in the eurozone and the European Union.
However, political science professor Stathis Kalyvas of Yale University said the Greek authorities would face major challenges regardless of the outcome.
He said a Yes vote could usher in a new government with a chance of negotiating an improved deal, while a No win could leave other eurozone nations unwilling to enter further discussions due to their distrust of Tsipras.
He added that the European Union would have to come up with “a very generous plan” if it wanted to keep Greece in the eurozone because the cost of the crisis had reached unanticipated levels.
German Finance Minister Wolfgang Schäuble told newspaper Bild that continued deterioration of the Greek economy would make any future talks between the country and its creditors “very difficult”.
Schäuble, who represents the biggest single economy within the eurozone, said voters faced a choice between keeping the euro and being “temporarily without it”.
However, as reports of looming food shortages and the rationing of medicine emerged, Schauble said: “It is clear that we will not leave the people in the lurch.”
Last night, politicians in Scotland congratulated the Greeks on taking a stand against austerity.
Green MSP Patrick Harvie MSP, said: “This vote shows austerity has failed and those bearing the brunt will no longer put up with it. Europe must stand with the people of Greece in their rejection of austerity.
Scottish Socialist Party spokesman Colin Fox said: “Greece’s Syriza government has stood up the the Troika’s economic terror tactics and won the backing of the Greek people despite them.”
Reports suggested expatriate Greeks had returned to vote in large numbers.
George Kerevan: This historic referendum is a watershed moment in European politics
Eyewitness: Capital controls on a Greek island
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