With just hours to go before its international bailout program expires and it defaults on a $1.8 billion International Monetary Fund (IMF) loan, Greece submitted a last-minute proposal for a new two-year rescue deal on Tuesday.
The offer involves a proposal to tap the European Stability Mechanism — a $560 billion bailout fund — and restructure Greece's debt, but no other details were given. Jeroen Dijsselbloem, the eurozone's top official, said the currency union's finance ministers would have a teleconference Tuesday evening to assess the proposal.
At 6pm ET on Tuesday Greece's current bailout program expires and according to EU officials the country will lose access to $18 billion in financial support. Greece is also set at 6pm ET to become the first developed nation to ever miss a debt repayment to the IMF.
According to the Financial Times, if a cash-strapped Greece does not pay its debt it will instantly lose access to IMF resources, and if no resolution is reached, the country could eventually lose its voting rights and be expelled from the fund.
When asked outside of the Finance Ministry earlier today whether Greece would make its payment to the IMF, Varoufakis responded "no."
The crisis worsened over the weekend after Prime Minister Alexis Tsipras called a referendum for Sunday on creditors' proposals for reforms in return for bailout loans. That increased fears the country could soon fall out of the euro currency bloc and Greeks rushed to pull money out of ATMs.
Cash withdrawals have been limited to $67 per day. Banks are shut and will remain so until at least next Monday.
The elderly have been hit particularly hard, with tens of thousands of pensions unpaid as of Tuesday afternoon. Many also found themselves completely cut off from any cash as they do not have bank cards.
The referendum on July 5 will ask the Greek public whether or not they want to accept the current bailout terms, which insist upon more austerity measures. European officials and Greek opposition parties have been adamant that a "no" vote in Sunday's referendum will mean Greece will leave the euro and possibly even the European Union.
The government says this is scaremongering, and that a rejection of creditor demands will mean the country is in a better negotiating position. Tsipras is advocating a "no" vote.
Yesterday, thousands attended an anti-austerity protest in Athens encouraging people to vote 'no.' Protests continued on Tuesday, with a huge pro-European rally in the capital's Syntagma Square.
The Associated Press contributed to this report.