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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.Yanis Varoufakis resigns

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.

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Greece has requested a new bailout deal from the eurozone, just hours before it must repay €1.6 billion to the International Monetary Fund (IMF).

The Greek government is asking for a new two-year €29.1 billion aid deal from a bailout mechanism for eurozone countries.

Eurozone finance ministers discussed the Greek offer in a teleconference on Tuesday evening, but made no decision.

If it fails to make the IMF payment, Greece could risk leaving the euro.

The European Commission, which is one of Greece’s creditors, wants Athens to raise taxes and cut welfare spending.

No advanced economy has ever missed a payment on an IMF loan.

Photo AP

Photo AP

Amid fears of a Greek default on its huge public debt of €323 billion – and a possible exit from the euro – long queues of people are continuing to snake from many cash machines in Greece, where withdrawals are capped at just €60 a day.

On Tuesday evening, thousands of pro-EU protesters braved stormy weather and gathered outside the Greek parliament in Athens to urge a “Yes” vote in a referendum on July 5 over whether the country should accept its creditors’ proposals.

It follows a similar demonstration by those advocating a “No” vote – the path preferred by PM Alexis Tsipras – on June 29.

Greek banks did not open this week after talks between Greece and its creditors broke down.

However, up to 1,000 bank branches will re-open from July 1 to allow pensioners – many of whom do not use bank cards – to withdraw up to €120.

The European Commission offered a slightly amended deal to Greece late on Monday night, which the Greek government did not accept.

Instead, Greece responded with a request for a two-year deal under the European Stability Mechanism (ESM), the bailout mechanism for eurozone countries whose aim is to maintain the stability of the euro. The ESM did not exist when Greece was bailed out in 2010 and 2012.

However, German Chancellor Angela Merkel has insisted that the eurozone’s wealthiest member will not enter into new aid negotiations with Greece before its weekend referendum.

“Before a referendum, as planned, is carried out, we won’t negotiate on anything new at all,” Angela Merkel said.

The ECB is believed to have disbursed virtually all of its emergency funds for Greece, amounting to €89 billion.

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