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Democratic Left withdraws from Greek coalition government Democratic Left withdraws from Greek coalition government
(about 3 hours later)
The smallest party in Greece's ruling coalition has pulled out of the government after a row over the abrupt closure of the state broadcaster, leaving the prime minister, Antonis Samaras, with a tiny majority in parliament. The political uncertainty engulfing Greece intensified on Friday as a junior partner in the fragile coalition government announced it was defecting after a heated dispute over the public broadcaster.
Democratic Left MPs voted to withdraw their ministers from Samaras's government but have yet to decide whether to offer external support in parliamentary votes to keep Greece's international bailout on track, party officials said. The government's parliamentary majority dwindled to three as the small Democratic Left party, Dimar, withdrew from the tri-partite alliance.
"The country doesn't need elections," the party's leader, Fotis Kouvelis, said. "The Democratic Left insists on its reform policy and will continue to seek and demand solutions within the European reality." "The country doesn't need elections," said Fotis Kouvellis, the party's leader. "The Democratic Left insists on reform policy and will continue to seek and demand solutions within the European reality … but it is opposed to autocratic behaviour and policies that promote party choices."
The moderate leftist party's departure is a blow to the conservative Samaras, who now has a three-seat majority in parliament. In a televised address after midnight, he said he was ready to press ahead without the leftists if necessary. The alliance had been uneasy from the time the government assumed power last June. The prime minister, Antonis Samaras, whose conservative New Democracy party narrowly won the last election, will now have to cohabit with his once bitter rival Evangelos Venizelos, leader of the social democratic Pasok party.
"I want us to continue together as we started but I will move on either way," Samaras said. "Our aim is to conclude our effort to save the country, always with a four-year term in our sights." The Pasok hegemon, a fiery professor of law widely regarded as Greece's most talented politician, is expected to take over as foreign minister and assume the title of deputy prime minister. He said his party would remain in the coalition "because we know Greeks do not want fresh elections".
The row over the future of the state broadcaster, ERT, coincided with a hitch in Greece's EU-IMF bailout. There is a potential funding shortfall because of the reluctance of some eurozone central banks to roll over their holdings of Greek government bonds. Dimar, which controls 15 seats in the 300-member parliament, may continue to offer passive support for the government – backing it on critical reforms demanded by the country's creditors .
Ten-year Greek government bond yields rose to their highest levels since late April, on course for their biggest daily rise since July 2012, while Greek stocks tumbled 4%. But analysts said the rupture in the coalition did not bode well at a time of mounting pressure from the EU and IMF to enforce measures that are deeply unpopular.
Samaras's New Democracy party and its socialist ally, Pasok, command 153 deputies in the 300-seat parliament, but without the Democratic Left's 14 the outlook is more unstable. "Dimar's withdrawal has stripped the coalition of any leftwing and social alibi," said Giorgos Kyrtsos, a leading rightwing commentator. "What you have, instead, is a government run by the two established political forces who are responsible for Greece going bankrupt in the first place."
John Loulis, a political analyst, said: "The government can't last for long in its new shape. The horse-trading will begin, there will be more crises, they won't be able to push reforms. At some point we'll have early elections whose outcome can't be predicted." With the IMF reportedly threatening to withhold further aid payments amid speculation that eurozone central government are poised to stop rolling over Greek debt, the pressure on Athens to speed up its reform programme is likely to grow.
Officials from all three parties ruled out snap elections for now, which would derail the bailout programme. "Opposition to policies both politically and socially will inevitably mount," said Kyrtsos. "Come October or November when new austerity measures will need to be taken to meet the financing needs of the state budget and pension system, there will be uproar. Frankly I don't give the government past Christmas."
Samaras attempted to put on a brave face on Thursday night, telling Greeks that with or without Dimar his government would serve out its four-year mandate. "Today we conclude one year as a government. Three years remain. We will serve them out," he said. "Our aim is to see through our efforts to save the country."
But the conservative leader, a patrician reformist, has also come under fierce attack from Venizelos for his behaviour in office. Samaras's abrupt decision to shut down the state-run broadcaster ERT and fire all 2,700 of its employees triggered accusations of arrogance and high-handedness, with both Pasok and Dimar insisting the prime minister had taken the step unilaterally.
In closing the channel 10 days ago Samaras had hoped to show foreign lenders who wanted 2,000 civil servants to be sacked by the end of June that he was cable of such a move. Public sector firings have been a red line across which no government has wished to pass since the outbreak of the debt crisis in late 2009.
Miscalculating the public backlash, he instead initiated the gravest crisis to hit his government to date. Even stalwart opponents of ERT, an organisation widely criticised for its perceived cronyism and profligacy, were outraged by the move.
On Thursday as the coalition leaders held their third emergency meeting over the dispute, the EU's economic and monetary affairs commissioner, Olli Rehn, said he hoped Greece would stay out of the headlines for a while.
"I love Greece but I'm very much looking forward to a eurogroup press conference where Greece is not going to be discussed," he said after a meeting of single currency finance ministers. "And a summer where we don't have any Greek crisis."
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