At one point, as part of an angry war of words between some of the main participants, European Commission head Jean-Claude Juncker said he felt "betrayed" by the way the Greek government had handled this last stage of the negotiation, in particular by "unilaterally" turning the problem over to a referendum.
The crisis has been simmering ever since Greece entered the eurozone in 2000, but worsened considerably in 2010 when Greek borrowing reached a record high and the first of a series of bailout plans were unveiled.
As CBC's Don Pittis wrote last week, the Greeks were blamed for borrowing too much money and spending it foolishly.
This latest crisis results from the recent history of severe austerity measures, a Tuesday deadline to repay or extend two huge loans from the European Central Bank and the International Monetary Fund, and now, in the wake of failed negotiations, a Greek referendum on the loan conditions, a referendum that could lead to a potential Greek exit from the euro. Here are the details in a nutshell.
Banks, stock market closed
The Greek stock market was closed today, and Greek banks are closed until July 6 with cash withdrawals limited to 60 euros (roughly $84 Cdn) a day to try to stave off a run on bank reserves.
People with foreign credit cards, like tourists, are not expected to be affected.
Canada's Department of Foreign Affairs has updated its travel advice, telling Canadians travelling in Greece that they should carry enough cash to cover unexpected travel expenses and to carry other means of payment, such as credit and debit cards.
The country's latest bailout program expires tomorrow, the same day a massive payment to the IMF is due.- Bailout program: Greece asked the European Central Bank for an extension to the bailout program so that it can continue to access 7.2 billion euros in rescue loans. The country's prime minister had also wanted a few extra days to allow for a referendum on the proposed austerity measures. That extension was rejected, but the referendum is going ahead anyway.
- IMF payment: On the same day, the deadline is up for Greece to pay back 1.2 billion euros to the IMF. Reuters reported Monday that a Greek government official said the country would not pay it back by the deadline.
The refusal to extend the ECB bailout angered Greek Prime Minister Alexis Tsipras.
"It is now more than clear that this decision has no other aim than to blackmail the will of the Greek people and prevent the smooth democratic process of the referendum," Tsipras said on the weekend.
The referendum is still scheduled for July 5. It asks Greeks to approve or reject the terms set by the country's creditors, and Tsipras has urged the country to vote against the proposed measures.
However, it's unclear whether a referendum will matter if Greece doesn't get an extension on Tuesday.
Controversial austerity measures
Since 2010, Greece has implemented severe austerity measures in exchange for the loans from the IMF and the European Central Bank. The measures have included salary freezes, cuts to health care and pensions, and tax hikes.
Some of the consequences have been a drop in wages, increases in homelessness and unemployment, and a spike in the suicide rate.
The country has also seen considerable unrest and countless protests over the years against the measures, which resulted in the election of the leftist, anti-austerity Syriza party in January.
Latest proposed austerity measures
In order for Greece to get an extension on its bailout, the ECB has insisted it agree to more austerity measures. The latest proposal calls for further tax increases, coupled with about eight billion euros in spending cuts.
In a televised address to the country, Tsipras said the proposals place "unbearable burdens on the Greek people."
EU officials and creditors indicated they are still willing to strike a deal. Tsipras, however, has dismissed all their proposals, saying he has already made every concession possible.
Potential default consequences
It's not yet clear what a Greek default could mean, but some EU member countries and the U.S. are urging Greece to do everything it can to stay in the union.
Some possible results are:- Greece could default on its loans, like Argentina did in 2001, though this would be on a much larger scale.
- A default would likely mean Greece would stop using the euro (and have to reintroduce its own currency), and perhaps leave the European Union altogether.
- A Greek exit from the EU would affect the entire EU as member countries are also creditors in addition to the ECB and the IMF. By some estimates, a default would cost France and Germany 150 billion euros alone.
A snap Reuters poll of economists and traders on Monday found a median 45 per cent probability that Greece would leave the eurozone.
If Greece doesn't pay back its debt to the IMF, it will take a while for the IMF to actually declare Greece in default. Credit ratings agencies say arrears to the IMF will not immediately trigger a default rating for Greece.
But the IMF won't give Greece more money unless the arrears are taken care of. That puts Greece in the same bin with fragile, war-torn developing countries in Africa and Latin America.