Tue, Jul 10, 2012 - Page 7 News List

Samaras wins confidence vote as eurozone meets

Bloomberg

Greek Prime Minister Antonis Samaras reacts after a vote of confidence procedure in the Greek parliament in Athens, Greece, late on Sunday.

Photo: EPA

Greek Prime Minister Antonis Samaras won a vote of confidence in his government, setting the stage for a showdown with the EU over easing the terms of its bailout.

Samaras received 179 votes in support, compared with 121 votes against, according to a tally in the parliament in Athens early yesterday. Samaras’ government is backed by the socialist Pasok and the Democratic Left parties, which gives him 179 seats in the 300-seat chamber.

“The only path to avoid the crisis and an exit from the euro is growth and investment,” Samaras said before the vote. “Europe acknowledges that along with fiscal adjustment, there must be growth.”

Greece’s new government was testing creditor countries’ appetite to ease its bailout terms as Greek Finance Minister Yannis Stournaras attended his first meeting of euro counterparts in Brussels yesterday. The government, formed after Samaras’ New Democracy party narrowly beat anti-bailout party Syriza in a June 17 election, is hoping to renegotiate some of the austerity measures in the second, 130 billion euro (US$159 billion) rescue package as the country suffers a fifth year of recession.

The concessions may be hard to wring from some EU leaders, after the eurozone and IMF pledged a total of 240 billion euros in aid for Greece, even as political instability in Athens, which led to two national elections in six weeks, sparked concern about the future of the 17-nation single currency.

Greece has some leeway to shift the composition of taxes and spending to meet its deficit-reduction targets without renegotiating the targets themselves, a European official told reporters in Brussels on Friday on condition of anonymity.

A four-month policy making hiatus caused by the elections means Greece cannot count on the next tranche of its aid disbursement until it proves that the economic-overhaul strategy is back on track, the official said.

Decisions on the next Greek aid payment are not likely until next month, the official said. Stournaras told lawmakers in his first address to parliament that budget measures for this year needed to be implemented, even if targets were not met due to the greater than forecast recession, or else Greece will risk the next loan payment from its creditors.

Samaras has pledged to put the nation’s economic reform plan back on track, promising to ramp up the pace of state-asset sales to boost investment and jobs and help finance an extension to the fiscal adjustment plan.

The government yesterday completed the sale of four Airbus A340-300 aircraft, formerly used by the country’s state-run airline, for US$40.4 million, the Greek Finance Ministry said in an e-mailed statement.

“Each euro from the exploitation of state assets is 1 euro less needed from fiscal measures which would further weigh on the recession and the country’s social crisis,” Stournaras said.

He said priority would be given to six assets, including the country’s natural gas monopoly.

The government’s emphasis on state-asset sales set up a clash with Syriza, the second-biggest party in parliament, which has said that negotiations with the so-called troika of official creditors — the EU, the IMF and the European Central Bank — are pointless.

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