Greek crisis: All sides take deep breath and wait for Sunday’s results

After days of turmoil, things have turned relatively quiet in Brussels as focus turns to Sunday's referendum in Greece.

The Wednesday decision by the country’s troika of lenders to definitively close negotiations until the ballot can be seen as an attempt by creditors to push responsibility for Greece’s next move on to the shoulders of the Greek public and their government. But it also gives space for Syriza to control the narrative and interpretation of what the referendum will actually mean.

The last 24 hours have seen senior politicians in Syriza intensify their calls for a No vote, reiterating their argument that a vote against the terms of the bailout programme would in fact strengthen Greece’s negotiating hand in discussions.

While the frenetic conversations between Brussels and Athens fell silent yesterday, there were some interventions from senior figures on the lenders’ side.

No means exit

In his strongest comments yet, eurogroup president

Jeroen Dijsselbloem

told a Dutch parliamentary committee that a No vote would mean a Greek exit from the euro.

Stressing that austerity measures are needed to put the Greek economy back on track, he said that if the Greek people did not want that, “there is not only no basis for a new programme, there is also no basis for Greece in the euro zone.”

Dijsselbloem also took aim at Syriza’s argument that a No vote would strengthen Greece’s negotiating position. “One illusion must be swept from the table: that if the outcome is negative then everything can be renegotiated and you will end up with an easier and more attractive package.”

French prime minister Manuel Valls was equally blunt. "We are asking [Greek voters] to vote with their eyes open and think hard about all the consequences of a No vote, which could lead Greece to leave the euro zone," he said on the sidelines of an economic summit in Lyon.

Polls over the past two days have been contradictory in their predictions ahead of Sunday. A poll allegedly compiled for French bank BNP Paribas put the Yes side at 47 per cent and 43 per cent at No, though polling company GPO later clarified that the data were “fragmentary findings” that leaked without its knowledge or permission.

As confusion reigned over the hue of public opinion, lingering questions remained over the actual legality of the vote, with Greece’s supreme court due to consider a legal challenge to the hastily convened referendum on Friday.

Political dynamics

Domestic political dynamics are also weighing heavily on political discourse, with opposition party New Democracy driving hard for a Yes vote. Former prime ministers

Antonis Samaras

and

Kostas Karamanlis

have publicly called for a Yes vote, as well as the mayors of Athens and Thessaloniki.

The real implications of a Yes or No vote remain to be seen, given that the euro zone is now in unchartered territory. What does appear clear is that, should the Yes side triumph, discussions would start on a third bailout programme between lenders and what is likely to be a new pro-euro national unity government, given that finance minister Yanis Varoufakis, and probably the rest of the Syriza government, would be expected to resign.

How lenders would response to a No vote is the key question, as Syriza will likely argue that it has a mandate to reject the austerity proposals demanded by creditors.

All of these suppositions could also be superseded by events, particularly developments in the banking sector.

While Varoufakis insisted the banks would reopen next Tuesday without complications, the Greek banking system is under severe strain.

The European Central Bank’s next move could play a crucial role in how events unfold in the coming days and weeks.