Yanis Varoufakis Resigns as Greece’s Finance Minister

Greece’s chief bailout negotiator Euclid Tsakalotos has replaced the country’s outspoken Finance Minister Yanis Varoufakis, who resigned on July 6.

Yanis Varoufakis had become a lightning rod in Greece’s talks with Europe. In resigning, he conceded that his poor relations with other European finance ministers had become an obstacle in the search for a solution to Greece’s debt crisis.

He wrote in a blog post on July 6: “I was made aware of a certain preference by some Eurogroup participants, and assorted <<partners>>, for my … <<absence>> from its meetings; an idea that the prime minister judged to be potentially helpful to him in reaching an agreement.

“I shall wear the creditors’ loathing with pride.”

During his time in government, Yanis Varoufakis refused to adopt the mannerisms of a conventional European politician. Instead, he dressed informally and loudly. He frequently appeared in media, launching biting rhetorical attacks against rival negotiators and governments.

While it may have appealed to populists, critics said Yanis Varoufakis’ abrasive style alienated many in the negotiating room.

His resignation came just a day after Greece voted against Europe’s latest bailout offer, raising the prospect that Greece could now suffer a worse economic disaster and lose its place in the euro.

Euclid Tsakalotos’ first task will be to present Greece’s ideas for breaking the deadlock at a meeting of eurozone finance ministers on July.

Meanwhile, eurozone finance ministers say they expect to hear new proposals from Greece after Greek people voted to reject the terms of a bailout.

A spokesman for German Chancellor Angela Merkel said there was currently “no basis” for talks on a new bailout and the ball was in Greece’s court.

Angela Merkel has met French President Francois Hollande in Paris ahead of a eurozone summit on July 7.

Meanwhile, Greek banks are to stay closed on July 7 and July 8.

Banks had been due to reopen on July 7 but the head of the Greek banking association, Louka Katseli, said the period had been extended following talks on July 6.

Germany’s economy minister has warned against any unconditional write-off of Greece’s debt, saying it would destroy the single currency.

Eurozone finance ministers are to meet on July 7 followed by a full summit of eurozone leaders. According to a Greek government official, PM Alexis Tsipras is expected to present fresh proposals at the summit.

Alexis Tsipras has noted that a recent IMF assessment confirmed that restructuring Greece’s debt of more than €300 billion ($331 billion) was necessary.