Greek pro-bailout parties secure ruling majority
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ATHENS (Reuters) - Parties supporting a bailout saving Greece
from bankruptcy won a slim parliamentary majority on Sunday, beating
radical leftists who rejected austerity and bringing relief to the euro
zone which was braced for fresh financial turmoil.
The election result looked
likely to yield a coalition government led by conservative New Democracy
but leaves an emboldened SYRIZA bloc to rally angry opposition in the
streets to the punishing terms of the bailout.
Official
results released by the interior ministry, with 97 percent of ballots
counted, showed New Democracy taking 29.7 percent of the vote, with
SYRIZA on 26.9. The PASOK Socialists were set to take 12.3 percent of
the vote.
Because of a 50-seat
bonus given to the party which comes first, that would give New
Democracy and PASOK 162 seats in the 300-seat parliament, in an alliance
broadly committed to the 130 billion euros ($164 billion) bailout.
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Germany signaled there may be some leeway on the timeframe for cuts demanded in return for the aid.
The result buys time for the euro zone,
which was braced for a SYRIZA victory and the prospect of having to cut
debt-ridden Greece loose, potentially unleashing shocks that could
break up the single currency.
But
it exposed a deeply divided society, seething over the wage, job and
pension cuts imposed as the price of two EU/IMF bailouts since 2010
totaling 240 billion euros.
The savage austerity has helped condemn Greece to five years of record recession and plummeting living standards.
Any
new government could find its tenure short-lived. New Democracy and
PASOK are unlikely to have won much more than 40 percent of the vote
between them.
"The Greek people
voted today to stay on the European course and remain in the euro zone,"
New Democracy leader Antonis Samaras, 61, told jubilant supporters.
"There will be no more adventures, Greece's place in Europe will not be
put in doubt."
The euro climbed and world stock markets looked set to make gains on the back of the result.
With
leaders of the Group of 20 world economic powers convening in Mexico
for a meeting on Monday, a statement from the Group of Seven major
nations said it was in "all our interests" for Greece to remain in the
euro zone while respecting its international bailout commitments.
FIGHT GOES ON
SYRIZA
leader Alexis Tsipras, a former communist and student protest leader,
conceded defeat, but vowed to spearhead opposition to Greece's austerity
drive.
"From Monday, we will
continue the fight," said Tsipras, who has gone from fringe obscurity to
worldwide recognition in a matter of weeks. "A new day for Greece has
already dawned," he said.
His supporters chanted, "Today was only the start. We will fight to topple these policies."
Two
PASOK officials said the party would support a New Democracy-led
government, either by ruling with them or by voting with the government
in parliament. PASOK said it wanted an administration to include SYRIZA,
but the radicals ruled this out.
The
White House said it hoped the election outcome would lead to the swift
formation of a new government that would make "timely progress" on
economic challenges.
"We believe
that it is in all our interests for Greece to remain in the euro area
while respecting its commitment to reform," Jay Carney, President Barack
Obama's press secretary, said.
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Samaras
told Reuters he was relieved by the vote. "I am relieved for Greece and
Europe. As soon as possible we will form a government," he said.
A
spokesman for Angela Merkel said on Twitter that the German chancellor
had called Samaras to congratulate him "on good result, hope for quick,
stable government".
Under a
scorching sun, voters appeared torn between deep anger over the terms of
the bailout and the traditional ruling parties who adopted it, and fear
that a SYRIZA victory could bring a return to the drachma and even more
economic calamity.
Many Greeks
blame the traditional elite under New Democracy and PASOK for presiding
over years of corruption and waste which have left them with a ruined
economy and one of the heaviest debt burdens in the world.
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The
edges of Greek society are starting to fray under the country's
severest test since the overthrow of the military dictatorship in 1974.
The ultra-right Golden Dawn party looked set to win 18 seats.
The
streets of central Athens are scarred by repeated waves of protests,
some hospitals are short of vital medicines and reports of suicides
caused by the crisis have become routine.
"I
voted for the bailout because these are the terms that will keep us in
Europe," said 66-year-old English teacher Koula Louizopoulou after
casting her ballot in Athens.
"It's
the first time I feel depressed after voting, knowing that I voted
again for those who created the problem, but we don't have another
choice."
ROOM FOR RENEGOTIATION?
Euro zone finance ministers said the bailout terms remained the best way to drag Athens out of the crisis.
"The
Eurogroup acknowledges the considerable efforts already made by the
Greek citizens and is convinced that continued fiscal and structural
reforms are Greece's best guarantee to overcome the current economic and
social challenges and for a more prosperous future of Greece in the
euro area," they said in a statement.
Euro zone paymaster Germany said the result represented a commitment to the bailout.
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"The
German Federal Government would consider such a result a decision by
Greek voters to force ahead with the implementation of far-reaching
economic and fiscal reforms," German Finance Minister Wolfgang Schaeuble
said in a statement.
Samaras says
he wants to renegotiate the loan terms to promote growth and has called
for an extra two years to make the cuts demanded of his country.
Greece's
lenders say a new government must accept the conditions of the bailout
or funds will be cut off, driving Athens into bankruptcy. But it may be
given more time to meet them.
"There
can't be substantial changes to the agreements but I can imagine that
we would talk about the time axes once again, given that in reality
there was political standstill in Greece because of the elections, which
the normal citizens shouldn't have to suffer from," German Foreign
Minister Guido Westerwelle said on German TV station ARD.
The
euro hit a one-month high against the U.S. dollar, rising to around
$1.2747 in early Australasian Monday trade, from around $1.2655 late in
New York on Friday.
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"What stands
out is how close SYRIZA came ... so we expect some robust opposition to
the austerity measures," said Daragh Maher, currency strategist at HSBC
in London. "Markets will be concerned about how narrow the margin of
victory was for ND and any gains in the euro and other markets will be
limited." ($1 = 0.7921 euros)
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(Additional reporting by Lefteris Papadimas, Karolina Tagaris, George Georgiopoulos, Maria Paravantes, Deepa Babington, Dina Kyriakidou, Greg Roumeliotis and Michael Stott in Athens, Annika Breidthardt in Berlin, Jan Strupczewski in Brussels, Matt Spetalnik in Chicago and Luke Baker in Los Cabos, Mexico. Writing by Matt Robinson, editing by Mike Peacock)
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