November 22, 2024

Interim Greek Government Wins Confidence Vote

The government of Prime Minister Lucas Papademos, a former vice president of the European Central Bank, secured 255 votes in the 300-seat Parliament. In a poll conducted by roll call, 38 lawmaker voted against the government and seven were absent. Only three members in the three-party coalition — two from the Socialist party, Pasok, and one from a conservative party, New Democracy — voted against the government.

Speaking before the vote, Mr. Papademos appealed for the widest possible support for his administration’s bid to put the country’s fiscal house in order. “Each vote corresponds to a vote of responsibility to ensure that the effort to rescue the economy continues,” he said.

The prime minister said that for foreign creditors to continue working with Greece, the leaders of all three parties in the coalition would have to offer the written guarantees sought by foreign creditors — a clear nudge to the conservative and right-wing parties that have rejected the demand. “This commitment is being asked of Greece by our foreign partners who are committing to many years of financial support to Greece,” Mr. Papademos said.

The government’s victory, though anticipated, was an important step toward securing the rescue financing that Greece needs to pay its bills through December as well as a step toward clinching a European Union debt deal for Greece that was hammered out in Brussels last month. That deal calls for an additional $175 billion in loans and a 50 percent write-down on the face value of Greek debt held by private banks. But this support is far from guaranteed, and it is expected to be the main topic of discussion between Mr. Papademos and European Union officials in Brussels next Monday.

One possible stumbling block is the refusal by the leader of the conservative New Democracy party in the coalition, Antonis Samaras, to give European Union officials written guarantees that the new deal’s terms will be met. Mr. Samaras repeated Wednesday that his support for the new coalition government, which has pledged to carry out the deal, should be adequate. His remarks were echoed by the leader of a right-wing party, Giorgos Karatzaferis.

Mr. Samaras’s stance has been dismissed by many analysts as posturing. But he has yet to back down, and European Union officials appear unwilling to take no for an answer.

On Wednesday, Jean-Claude Juncker, the president of the Euro Group, an organization of European finance ministers, said he expected a sixth tranche of aid for Greece — a sum of about $10.7 billion on which the country’s solvency depends — to be released by the end of November.

But he added that European Union officials required a “letter from Papademos.” Mr. Juncker did not mention the coalition leaders, but his spokesman was later quoted by Greek state television as saying that the letter would need to bear the signatures of the leaders of the two main parties in the Greek coalition — Mr. Samaras and former Prime Minister George A. Papandreou of the previous Socialist administration.

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Greek Leader Reshuffles Cabinet, Asks for Vote

Earlier in the day, as thousands took to the streets to protest austerity measures, Mr. Papandreou had offered to step aside so that his Socialist party could form a coalition government with the center-right opposition, but only if it would support a new bailout plan for the debt-ridden country. Greece needs to pass a new round of austerity measures by the end of the month in return for fresh loans from the International Monetary Fund and the European Union.

 News of the political instability here rattled world financial markets, which fear that Greece’s failure to agree on an austerity package could lead to a default that could ignite a series of crises in other heavily indebted euro zone countries, like Portugal, Ireland and Spain. That, in turn, could threaten Europe’s banks.

Greece instituted a round of painful budget cuts last year in exchange for international financial assistance that staved off default. With the country now seeking a new round of financing, Greek leaders face the nearly impossible task of balancing the demands of their hard-pressed citizens with those of the I.M.F. and the European Union.

Mr. Papandreou’s support is plummeting, even within his party, and the Socialists in turn appear to be lagging behind the center-right opposition for the first time since the current government was elected in 2009. With a five-seat majority in Parliament, Mr. Papandreou has been struggling to get his government fully behind the measures amid growing rifts within his party.

Antonis Samaras, the leader of the center-right New Democracy party, has opposed spending cuts, calling instead for tax breaks and a renegotiation of the terms of Greece’s agreement with its foreign creditors.

After hours of speculation, Mr. Papandreou went on national television just before 10 p.m. local time and announced the cabinet reshuffle. He criticized the opposition for playing politics with the country’s future.

“I have asked for this effort to be a common one, I made constant appeals for consensus to the opposition,” he said. “Today, I repeated those appeals,” he said.

The prime minister also accused the opposition of leaking details of a highly sensitive preliminary conversation to the news media. Before the two leaders could discuss possible terms, he said, “Certain conditions were made public, which would not be acceptable because they would keep the country in a prolonged state of instability and introversion.”

Mr. Samaras defended his actions in a televised speech later on Wednesday, saying it was impossible to participate with the Socialists in a coalition government because “they have lost the trust of both the Greek citizens and the markets.” Speaking of Mr. Papandreou, he said, “If he can govern, he shouldn’t have asked us for support. If he can’t, he should call elections.”

On Wednesday, thousands joined a nationwide strike as Parliament prepared to debate a second round of sharp cuts to government spending. The measures are highly unpopular with Greeks, who have already suffered deep salary and pension cuts.

“We had the first set of measures, that’s over, now they want a second,” said Angeliki Kolandretsou, 63, a retired private nurse who was one of thousands of Greeks who joined the nationwide strike Wednesday. “But what will we see from this? Nothing at all. It will just go to the banks.”

On Wednesday, the police fired tear gas and scuffled with protesters in the central Syntagma Square here. Some in the crowd smashed the windows of a luxury hotel and tried to prevent legislators from entering Parliament. Police officials said they had detained more than 20 people.

Violent and often theatrical protests have long been a mainstay in Greece, even before the financial crisis hit. But in a more telling sign of the depth of the anger, for three weeks, peaceful demonstrators have gathered daily in Syntagma Square, some sleeping in tents, to protest the austerity measures.

Wednesday’s protest drew 25,000 largely peaceful demonstrators from across Greek society.

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