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Greek economy reaches low point on eve of referendum

By Tomas Monzon
Greek Prime Minister Alexis Tsipras has urged Greeks to vote no on the bailout referendum. File photo by Hugo Philpott/UPI
Greek Prime Minister Alexis Tsipras has urged Greeks to vote no on the bailout referendum. File photo by Hugo Philpott/UPI | License Photo

ATHENS, Greece, July 4 (UPI) -- The Greek economic crisis reached a nadir Saturday, on the eve of a referendum that will chart the country's economic future.

Beginning Sunday at 7 a.m., Greeks will vote on whether they agree with the terms of creditors that want to extend a bailout deal for the country. Public buildings across 56 voting districts will be open until 7 p.m. or later, with anxiety about voter fraud due to delay the release of results until late Sunday evening.

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In the meantime, the Greek tourism and banking industries are relying on a cash buffer to keep them afloat through the weekend. Banks claimed they had a €1 billion buffer that would require immediate replenishment from the European Central Bank on Monday independent of the referendum results.

Greeks rushed to ATMs to withdraw their money following the announcement of the referendum, which further strained the banks.

Food and pharmaceutical drugs began to run out on Friday. Tourist destinations such as Mykonos and Santorini also reported shortages of imported foodstuffs that can't be purchased because bank transfers are now banned.

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Left-wing Prime Minister Alexis Tsipras, a member of the Syriza party that was elected to power in January on the promise of fixing Greece's economy, urged Greeks at a Friday night rally to vote no on the referendum. Tsipras says rejecting the blackmail and fear mongering by these creditors would allow him to reach a better deal.

Predicting the outcome of the referendum is difficult because public sentiment is rapidly changing. This is exacerbated by the large amount of swing voters and by the fact that Greeks had only about a week to review the debated terms.

Additionally, a Greek court challenged the constitutionality of the referendum on Friday. Although it did not block it, the validity of the referendum and its outcome may be challenged after it is held.

Many Greeks who are registered to vote in places far away from where they currently live may not make the trip to cast a ballot.

Greece's problems began in 2001 when it joined the European Union with a misrepresented economy profile created by keeping certain expenses off the books. Public sector wages and pension spending rose but came to a head when the global financial crisis shoved the country into debt.

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