ATHENS, June 30 -- Greece's international creditors do not want a Grexit, Greek Prime Minister Alexis Tsipras said on Monday night, as the country faced the first day with closed banks and capital controls, fueling concern over a looming default and exit from the euro zone.
"I do not think they want to throw us out, because the cost would be great for them," the Leftist leader said during an interview at the national broadcaster ERT a few hours after his government closed banks to prevent a collapse of the banking sector.
Tsipras defended his choice to call a referendum on Saturday for July 5 on the creditors' offer for a reforms-for-cash deal that sparked a wave of dramatic developments.
Eurogroup decided within hours that the extended bailout that kept the country afloat since 2010 expires on June 30, as agreed in February, while the European Central Bank announced the freeze of the extra emergency funding for Greek banks.
The Greek Premier put the blame for the collapse of negotiations for a deal on lenders again, accusing his interlocutors of lack of willingness to find common ground, expressing confidence that talks will resume and Greece will be in a stronger position after Sunday.
"The higher the participation and the percentage of people voting "NO" will be, the stronger our position will become," he said.
As pollsters note that the Greek electorate was divided between a harsh agreement and a risky rejection, Tsipras suggested that he would step down opening the way for new elections or a national unity government if the YES camp wins.
"If Greek people choose to remain under austerity, we will respect their decision, but we cannot serve such a mandate," he said, appearing certain that Greeks will vote for their dignity and his government will win a better deal.
International credit rating agency Standard and Poor's did not share this optimism. On Monday it downgraded Greece further into junk territory giving the Grexit danger 50 percent possibilities.
The concern that the worst case scenario may become a reality was fuelled by the messages sent by several European leaders on Monday.
President of the European Council Donald Tusk rejected Tsipras' new request for an extension to the bailout that expires on June 30 to allow voters to choose freely under no blackmails, as Athens argued. Greece should ask for a third bailout, he said.
German Chancellor Angela Merkelon Monday accused Greece of a lack of willingness to compromise, calling on the government to take "self-responsibility" in dealing with its debt issue.
French President Francois Hollandeexpressed hope that Athens would resume debt negotiations for last-minute breakthrough in the few hours before the talks would be definitely closed.
In the streets of Athens in front of ATMs and empty stores as well as in the offices of opposition legislators, businessmen and analysts, fear that the game was over and that Greece has entered a great adventure was widespread.
Scenarios of a looming national tragedy were circulating, as others appeared defiant "to creditors' ultimatums", assuring that life will go on and Greek people will survive anyway.
In any case the image of a European country with capital controls was not a positive one for Greece and the euro zone.
"This is a Black Monday for the European Unionvision. A fundamental principle of free capital transfer has been annulled. Capital controls will be imposed for a limited period, but meanwhile the economy will be idle," economist Dimitris Tsagaris said.
The expert noted that the fact that capital controls were imposed for a second time in three years in the eurozonedealt a heavy blow to the european common currency zone.
By government decree, banks and the Athens Stock Exchange will remain shut until July 6. Those in Greece who queued in front of ATMs during the weekend to withdraw cash from now on face a 60-euro-per-day limit.
On Monday night the Finance Ministry dismissed media reports that the limit would be reduced to 20 euro per day.
Pensioners lining up outside a limited number of bank branches to get their pensions, such as Nikos Papageorgiou feared a replay of past difficult post-war times.
"Why did Mr. Tsipras leave us in the dark, without any warning? These pictures in the streets and in front of the banks and the supermarkets brought to me memories from the past," he told Xinhua outside a bank branch in the northern Athens suburb of Maroussi.
Computer engineer Stratou Kalafateli, 29 years old, questioned the necessity of a referendum at such a critical period.
"It is tragic what is happening in Greece today. During the weekend, I went to five ATMs to take some cash for my daily expenses and there was no money ... I don't believe that the referendum was the right option. People have no information what 'Yes' and 'No' represents," she told Xinhua.
Officials assured that the supply of gas, electricity and medicines would not be disrupted in the near future, while the tourism ministry stressed that capital controls would not affect those traveling to Greece who use debit or credit cards issued abroad.
On the other hand, opposition parties and representatives of the business world urged the government to seek a compromise by Tuesday at midnight, since the clock was ticking and Greece was getting closer to meltdown each hour passing.
On June 30, Greece needs to pay back about 1.5 billion euros (1.67 billion U.S. dollars) in loan installments to the International Monetary Fund. A failure to meet its obligations for a second time in a month could set in motion the procedures to default in coming weeks.
While speaking to Xrima (Money) financial daily, Professor Panikos Dimitriadis who has served as central banker in Cyprus and witnessed the first time capital controls were imposed within the eurozone, warned that after the imposition of capital controls, all sides should try harder to achieve a compromise agreement to restore stability and liquidity.
"If it lasts for long, the repercussions will be nightmarish, it is never too late to find a solution," he said.
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