Roundup: Greek parliament approves referendum on debt deal as clock ticking

Greek parliament approved on early Sunday the government's call for the run of a referendum on July 5 over the proposed debt deal with foreign creditors as the clock to default risk was ticking.

Backed by the two ruling parties, the leftist Syriza and the right-wing Independent Greeks, as well as the far-right Golden Dawn party, the plenary ratified the surprise proposal for a referendum by Greek Prime Minister Alexis Tsipras early Saturday.

His shock move came after the last round of talks with lenders in Brussels this week failed as eurozone finance ministers rejected Athens' request to extend its bailout into July.

In favor of the referendum which has skyrocketed anxiety over a looming bankruptcy and possible Greek exit this summer, voted 178 deputies of the 300 member strong assembly.

With the critical deadline of June 30 nearing, without the extension of the bailout and with no sealed honest compromise with lenders, the debt-laden country faces the risk of immediate financial meltdown after five years of painful sacrifices to overcome the crisis.

Without a deal, Athens was expected to most likely fail to repay a loan installment to the International Monetary Fund.

The risk has increased after a Euro Group meeting in Brussels on Saturday afternoon rejected Athens' request for a new extension of the bailout for a few days so that Greek voters can accept or turn down the creditors' "barbaric and humiliating" offer for a reform for cash deal with no pressure and ultimatums, as Tsipras had suggested.

The euro zone finance ministers said that the Greek program and subsequently any aid to Greece ended on June 30 should a deal is not reached by then.

As the five-month negotiations between the two sides have collapsed, the Greek government's hardline rhetoric on Saturday indicated that the country was heading to a rift with lenders which could have severe repercussions on Greek economy, the country's European course and Euro zone, analysts warned.

"This day will be remembered in European history because the right of a sovereign nation to decide on its future was put in doubt," Tsipras said, addressing the plenary shortly before the vote at the end of a tumultuous marathon debate.

Criticizing Germany and Euro Group for the rejection and the failure of the negotiations, the Greek premier added that his government will not ask them for permission to protect democracy in Greece.

Tsipras insisted that the referendum he called was not about a rift with Europe but a rift with practices that offend Europe, and strongly dismissed "any efforts to turn the vote into a referendum on currency."

He claimed that the Greek side made honest attempts to strike a mutually beneficial and viable debt deal, blamed institutions for the impasse and warned that blackmailing backfires.

"We are a nation that loves peace, but we know how to fight and win once they declare war on us," the Greek leader said.

Quoting late U.S. President Franklin Roosevelt, he said that for Greeks at the moment the "only fear is fear itself."

In the street of Athens and across Greece, anxiety for the future was widespread after the referendum call.

Fearing the prospect of imminent capital controls starting as of Monday and eventually bankruptcy and a possible Greek exit, depositors lined up in front of cash machines throughout Saturday to make withdrawals.

Financial experts warned that in the light of Euro Group's decision on Saturday the European Central Bank could cut off Greece's banking sector even on Sunday from the Emergency Liquidity Assistance mechanism that keeps Greek banks running in recent months.

During phone contacts with European leaders on Saturday, according to Greek government sources, Tsipras said that Greece would survive regardless of its partners' decisions.

However, Greek society seemed divided between a harsh deal and stay in the euro zone after the referendum call. Surveys conducted recently before the referendum call showed that 60 percent of Greeks supported stay in the euro zone at any cost, while the rest opposed.

With this deep division, tensions were running high during the debate in parliament which was interrupted several times. After a heated argument, the opposition accused Parliament Speaker Zoe Konstantopoulou of violating the House rules regarding procedures. Endi