CRI听力:Tsipras Defiant as Default looms in Greek Debt Crisis

Greece's bailout from the European Union expires on Tuesday, the same day it faces a deadline to repay a 1.6 billion Euro loan to the International Monetary Fund (IMF).

The loan needs to be repaid by 18:00 Washington time, but Greek officials said on Monday, that there was no way they could come up with the money.

The European Union had earlier offered to extend its bailout and inject a further 7.2 billion Euros to Greece's cash strapped economy. But that deal now off the table after talks between the two sides broke down last week.

Greek Prime Minister Alexis Tsipras is now urging voters to reject creditors' demands in a snap referendum due on July 5.

Tsipras says a clear vote against austerity on Sunday would help Greece negotiate a better settlement to the crisis.

Otherwise, he warned, he would step down as Prime Minister as he did not want to oversee further austerity cuts.

"And I am saying that if the people, using as a basis the climate of fear mongering, decide that I am mistaken, I will serve as I always did: my truth, my believes, and my dignity. If the people want to have a prime minister humiliated and ridiculed, they can choose someone, there are many that are willing to do it. I am not."

EU leaders warn that if the Greek public rejects the creditors' proposals at the ballot box on Sunday, this would take Greece a step closer to leaving the Eurozone.
 
But Tsipras says he does not want this to happen.

"I don't believe they want to throw us out of the euro or that they will. They won't do this. Let me explain why: Because the cost is massive. The financial cost of breaking up the euro, the start of the break-up, the cost of a bankruptcy of one country which has a European Central Bank exposure of more than 120 billion is massive. It won't happen, that's my estimation."

Meanwhile, on Monday thousands of Greeks rallied in support of the "No vote."

One protester says further spending cuts would kill the country's economy, where a quarter of the workforce is already unemployed.

"Everybody's message here today is a loud and powerful 'no' against all these measures that Europe wants to impose on Greece. Why? So they can give us some pocket change?"

Despite this defiant stance, the country is teetering on the edge of bankruptcy as panic stricken depositors lined up day and night to withdraw small amounts of money from ATMs. Greece has been forced to close all national banks until the referendum to avoid a possible bank run. The country has also kicked in capital controls after the European Central Bank refused to throw Greek banks another lifeline.

The Athens stock exchange also remains closed as part of the emergency measures.

Meanwhile, Policymakers across the world are scrambling to ensure that the turmoil in Athens does not escalate into a broader financial panic.

For CRI I'm Poornima Weerasekara.