Pro-bailout party wins in Greece, reassuring a jittery Europe

Greece’s pro-European New Democracy party finished first in critical parliamentary elections Sunday, making a strong enough showing to form a coalition government and to reassure European partners that Greece will continue repaying its debts.

Ending six weeks of uncertainty in which no party was able to form a government after a first round vote – and with an upstart leftist party calling for a halt in debt repayment – New Democracy won 29.08 percent of the vote, assuring it 129 seats in the 300-seat parliament, according to provisional results with 92.5 percent of the ballots counted.

Together with the severely weakened Socialist PASOK party – and possibly the small Democratic Left – as partners in a governing coalition, the center-rightist New Democracy leader, Antonis Samaras, should be able to form a majority, although its stability and longevity remain to be seen.

“We will respect the signature and the obligations of the country,” said Samaras, a former Greek foreign minister, reaffirming the country’s commitment to repay the 240 billion euro ($303 billion) bailout package. Greek willingness to uphold the terms of the bailout – as the leaders of Germany and other creditor nations have demanded – has emerged as a key factor in its ability to remain in the euro currency zone.

Antonis Samaras arrives to make the presentation

European governments and major markets may breathe a sigh of relief, but it could be temporary, for the turmoil in Greece is far from over. The country has suffered 13 consecutive quarters of recession under the austerity program, with the economy shrinking by 15.9 percent. The unemployment rate is 22.6 percent – a staggering 52.7 percent for Greeks 24 and younger.

Minutes after Samaras proclaimed victory, calling for an “end to petty politics” and proposing leading an all-parties government of national salvation, his principal rival, Alexis Tsipras, issued a frontal rebuff. Calling the victors “an alliance of the forces of the past,” Tsipras pledged that his leftist Syriza party would continue to reject the European-imposed austerity program and function as a “vibrant opposition.”

The White House welcomed the election and expressed hope that it would lead “quickly to the formation of a new government that can make timely progress” on the economic challenges faced by Greece.

Euro zone finance ministers also issued a low-key welcome to the outcome and promised to assist Greece in carrying out the austerity program “in order to address the many challenges the economy is facing.” That ambiguous wording appeared to leave open the possibility for changes in the debt repayment schedule and – as France and some other European nations have argued – for an injection of funds to spur growth.

German finance minister Wolfgang Schaueble, whose frequent scoldings of the Greeks during the election campaign are thought to have boosted Syriza’s popular support, said he took the election results as “a vote in favor of reforms,” a reference to the austerity program.

Tsipras’s public appearance before supporters appeared to be more a celebration of victory than a concession of defeat. His party won 26.79 percent of the vote, or 71 seats, a meteoric rise from the parliamentary elections in 2009, in which Syriza won only 4.6 percent and 13 seats. It was also a considerable boost from the 16.8 percent, or 52 seats, it won in elections on May 6, after which the winning parties were unable to form a governing coalition, leading to Sunday’s rerun.

“Anything we can demand with the strength the people gave us and from the strong presence of Syriza, we are not going to waste by offering support to those who are pro-(austerity),” Tspiras declared. “Twice in one month, our people denounced austerity and forced all parties to admit that the economic project of austerity has been rejected, and its further implementation is impossible.”

He said the new government “cannot work like the previous government and must take the people into account, and cannot insist on politics any longer that are contrary to the popular will.”

If the outcome constituted an enormous advance for Syriza, it was a modest recoup at best for New Democracy, which had 33.47 percent of the vote and 91 seats in the 2009 parliament, and sank to 58 and 18.85 percent in the May 6 elections. A provision in the election laws that gives a 50-seat bonus to the party that finishes first is the principal reason New Democracy has a strong chance to form the government.

Sunday’s election confirmed the collapse in support for PASOK, which in 2009 had 43.92 percent of the vote and 160 seats, but in the latest round only 12.38 percent and 33 seats. The biggest single loser in the latest round was Greece’s Soviet-style Communist party, whose support fell to 4.51 percent or 12 seats from 8.48 percent and 26 seats in May – possibly a rebuff by voters disenchanted over the party’s refusal to consider a coalition with Syriza.

The Golden Dawn party, denounced by critics as neo-fascist and even neo-Nazi, will be in the new parliament with 18 seats, having won 6.91 percent of the vote, a slight reduction in the 6.97 percent result it won in May.

The election divided the country on generational lines, with younger people voting en masse for Syriza and those over 50 giving significant support to New Democracy. There was also an urban-rural divide, with voters in cities leaning toward Syriza while and those in the countryside favored New Democracy. In the Athens suburbs, Syriza led New Democracy by 17.5 points.

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