Σάββατο, 12 Μαΐου 2012

Greece lurches towards new vote, hard left leads


(Reuters) - Greek politicians abandoned their quest to form a government on Saturday, leaving the president with one final opportunity to avert new elections that could drive the debt-choked country out of the European single currency.
Leader of the Socialists PASOK party Evangelos Venizelos (R) meets leader of Conservatives New Democracy party Antonis Samaras in Athens May 11, 2012. REUTERS-Yorgos Karahalis
Greece's political landscape is in disarray after voters humiliated the only parties backing a rescue plan tied to spending cuts, leaving no bloc with sufficient seats to form a government to secure the next tranche of financial aid.
Without aid from the EU and IMF, the country risks bankruptcy in weeks and - as European leaders now openly acknowledge - potential ejection from the euro zone.
On Saturday morning, Socialist leader Evangelos Venizelos met President Karolos Papoulias in the presidential mansion to formally confirm he had been unable to persuade other parties to form a broad coalition that would keep the bailout agreement but try to improve its terms.
The holdout was Alexis Tsipras, a charismatic 37-year-old radical leftist, who has emerged as the standard bearer for opponents of the bailout's harsh austerity measures and has the most to gain from a new election.
Papoulias has one last chance to press all political leaders to form a coalition. If he fails, he must call a new election in June. In televised remarks during their meeting, Venizelos urged the president to lean on Tsipras to join an "ecumenical government".
"I put this forth to Mr Tsipras. I haven't received a positive response," Venizelos said. "I believe that is where your efforts should be focused during the consultations."
The president replied: "There are signs of optimism in what you are telling me and I hope I can contribute to the formation of a government - because things are rather difficult."
Papoulias will meet the leaders of the country's three biggest parties on Sunday at 0900 GMT, his office said in a statement. He will then hold individual meetings with the leaders of the smaller parties.
The lurch towards a new election has caused havoc in financial markets, both in Greece and across Europe, where the prospect of Athens leaving the euro is viewed as a risk for bank balance sheets and the credit ratings of other vulnerable countries, although the EU is better prepared than it was a few months ago.
On Friday, as politicians acknowledged their failure to agree a coalition, the euro sank to its lowest point since January near $1.29.
Opinion polls conducted in the week since the election show Tsipras's SYRIZA coalition surging into first place - a prize that would give it an automatic bonus of 50 extra seats in the 300 seat house at the expense of the conservatives.
Tsipras says the bailout deal must be torn up, though like most Greeks he says he wants to keep the euro, a position seen in Brussels as untenable without the bailout.
"SEXY ALEXI"
Last Sunday's election saw voters punish the two parties that dominated the country for generations - Venizelos's PASOK and the conservative New Democracy party of Antonis Samaras.
The two, which usually account for around 80 percent of votes, saw their combined tally collapse to just 32 percent. The rest of the votes were cast for small parties that oppose the bailout, ranging from the Communists to the far right.
Polls conducted since then show the anti-bailout vote consolidating around Tsipras, whose good looks and self confident manner have helped make him a hero for young people.
Venizelos and Samaras say that without their bailout deal Greece would be headed for certain ejection from the euro and bankruptcy. If a second election does take place, they will be hoping that frightened voters return to the traditional parties.
But the momentum is clearly behind Tsipras, who has tapped into generational rage in a country where more than half of young people are unemployed and blame the narrow interests of the middle aged political class for squandering their future.
A cartoon on the front page of the Ta Nea newspaper showed the boyish Tsipras riding off with the ballot box on a toy horse. One of his supporters' slogans on the internet rhymes: "Come on Alexi - for a Greece that's sexy!"
A poll by Metron Analysis for the Epenenditis weekly published on Saturday showed SYRIZA would take 25.5 percent of votes - almost 9 points higher than its Sunday result. A poll earlier this week gave SYRIZA 27.7 percent. Such results would put it way ahead of New Democracy and PASOK.
The European Union/International Monetary Fund bailout requires Greece to cut wages, raise taxes, fire state employees, sell off state assets and reform labor laws. EU leaders say it is needed if Athens is ever to become solvent.
But opponents say the harsh medicine is self-defeating, making it impossible for Greece to grow its economy and emerge from the depths of the euro zone's worst recession, which has ground on relentlessly for five years.
Head of Greece's Left Coalition party Alexis Tsipras walks towards to the exit after a news conference at the parliament in Athens May 11, 2012. REUTERS-John Kolesidis
SYRIZA argues that Greece can abandon the bailout and that European leaders will not carry out their threats to withhold funding, because they cannot risk the damage to other EU countries that would be caused by a Greek collapse.
"They will be begging us to take the money," SYRIZA deputy Dimitris Stratoulis said on Friday.
But European leaders say the next tranche of loans due in late June is in jeopardy if Greece does not emerge with a government committed to the bailout. In a second election, voters would face a stark choice, said Chris Williamson, chief economist at London-based research firm Markit.
"I think it is going to be increasingly presented as a vote to effectively leave the euro. That's how it will be seen outside of Greece and the rhetoric will build up to ensure that voters are aware of the implications."

reuters

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