Greece’s socialist leader Evangelos Venizelos officially gave up the mandate to form a coalition government yesterday after three rounds of negotiations proved fruitless, bringing the crisis-struck country one step closer to new elections.
The country’s wrangling politicians will have one last chance at reaching an agreement for a government when Greek President Karolos Papoulias convenes the party leaders to try to broker a deal. If he fails, new elections will have to be called for next month, prolonging the political uncertainty and bringing Greece’s euro membership into question.
Venizelos was the third party leader to try to cobble together a governing coalition after elections last Sunday gave no party enough parliamentary seats to form a government. Voters furious at two years of harsh austerity measures taken in return for international bailouts worth 240 billion euros (US$310 billion) rejected Greece’s two formerly dominant parties, Venizelos’ socialist PASOK and the conservative New Democracy, in favor of smaller parties on the left and right.
The turmoil has alarmed Greece’s international creditors, who have stressed that the country must stick to the terms of its rescue deals if it hopes to continue receiving the funds that have been keeping it afloat since May 2010.
Whether Greece should adhere to the strict austerity measures required for the bailout loans or pull out of the deal has been at the heart of the wrangling over creating a coalition government. Alexis Tsipras, head of the Radical Left Coalition, or Syriza, that made massive gains to come second in last Sunday’s election, campaigned on an anti-bailout platform and says any new government must cancel the austerity measures. He says the terms are so onerous that they are giving the country’s battered economy no chance of recovery.
However, both Venizelos and Antonis Samaras, head of New Democracy, have slammed Tsipras’ position as irresponsible. They say his policies would lead to disaster and force Greece out of the EU’s joint currency — something that none of the political leaders say they want.
Hopes had been raised that a solution could be found in the form of a partnership between New Democracy, PASOK and the smaller Democratic Left party of Fotis Kouvelis, whose 19 seats put it in a potential kingmaker position. However, all three parties have said they cannot join forces without the support of Syriza, given its strong performance in the elections.
Handing back the mandate to the president, Venizelos said that while there had been a meeting of minds between his party, Democratic Left and New Democracy, Tsipras was sticking to his position.
Papoulias could break the deadlock when he calls the party leaders for a last-ditch attempt at a solution, but chances are slim. Recent opinion polls show Syriza would win new elections if they are called.
Although it would not get enough votes to form a government on its own, it would benefit from regulations that give the first party a bonus 50 seats in the 300-member parliament, putting it in the dominant position to seek coalition partners among other anti-bailout parties.
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