ATHENS, Greece — Greece slipped deeper into its financial abyss after the bailout program it has relied on for five years expired at midnight Tuesday and the country failed to repay a loan due to the International Monetary Fund.
With its failure to repay the roughly 1.6 billion euros ($1.8 billion) to the IMF, Greece became the first developed country to fall into arrears on payments to the fund. The last country to do so was Zimbabwe in 2001.
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After Greece made a last-ditch effort to extend its bailout, eurozone finance ministers decided in a teleconference late Tuesday that there was no way they could reach a deal before the deadline.
“It would be crazy to extend the program,” said Dutch Finance Minister Jeroen Dijsselbleom, who heads the eurozone finance ministers’ body known as the eurogroup. “So that cannot happen and will not happen.”
“The program expires tonight,” Dijsselbleom said.
The brinkmanship that has characterized Greece’s bailout negotiations with its European creditors and the IMF rose several notches over the weekend, when Prime Minister Alexis Tsipras announced he would put a deal proposal by creditors to a referendum on Sunday and urged a “No” vote.
The move increased fears the country could soon fall out of the euro currency bloc and Greeks rushed to pull money out of ATMs, leading the government to shutter its banks and impose restrictions on banking transactions on Monday for at least a week.
Related: Greek Financial Crisis: 7 Things Investors Need to Know But in a surprise move Tuesday night, Deputy Prime Minister Yannis Dragasakis hinted that the government might be open to calling off the popular vote, saying it was a political decision. The government decided on the referendum, he said on state television, “and it can make a decision on something else.” It was unclear, however, how that would be possible legally as Parliament has already voted for it to go ahead.
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