Athens: Greece’s party leaders are scheduled to meet on Thursday morning in a fresh attempt to clinch an elusive deal on a national unity government, after days of political bickering took the country closer to an economic abyss.
The president’s office said a meeting of party leaders would be held at 0800 GMT on Thursday, in the fourth day of roller-coaster coalition talks, although in the current chaotic atmosphere meetings are often delayed or fail to happen at all.
The collapse late on Wednesday of a deal brokered earlier in the day on naming the house speaker as Prime Minister revived the chances of former European Central Bank (ECB) vice president Lucas Papademos heading the coalition.
The stakes are high. As well as winning parliamentary approval for the bailout, the coalition has to pass the 2012 budget and secure the latest €8 billion installment of Greece’s original rescue that was pulled together last year, to avoid bankruptcy when big debt repayments come due in December.
Happier times: Greek Prime Minister George Papandreou. Photo: Reuters
On Wednesday, Prime Minister George Papandreou said he was handing over to a coalition that does not exist and then failed to install an old-style politician and personal ally as premier. On a day that was bizarre and chaotic even by Greek political standards, Papandreou wished his successor well and headed off to meet the president - only for it to emerge that there was no successor due to feuding in the political parties.
Greeks and the nation’s international lenders have watched in growing horror since Monday as party leaders fight over a shrinking list of credible candidates to lead the national unity coalition after Papandreou’s government imploded.
“The politicians have succeeded in making us really angry,” conservative daily Kathimerini wrote in an editorial. “The country is sinking and they are concerned with their party interests, their personal aspirations and their usual intrigues.”
Stefanos Manos, a former finance minister, said the behavior of Papandreou and conservative leader Antonis Samaras was undermining Greece’s future in the euro and risking a possible return to the national currency.
“The Europeans are sick of us. Papandreou and Samaras don’t realize they will stop giving us money and we will return to the drachma,” said Manos. “They are going to destroy us. These problems demand decision-making. They can’t decide on anything and they are fighting like cat and dog.”
Greece will run out of money next month unless the new government agrees emergency funding with the European Union (EU) and International Monetary Fund (IMF), Greece’s last remaining lenders.
“The country cannot afford to be in a limbo. This pending issue has to be wrapped up today,” centre-left Ta Nea said. “Politics cannot be a theatrical stage, especially during a time of national crisis.”
Former Greek central banker Papademos, whose candidacy had seemed doomed, insisted that both the socialist and conservative parties sign written undertakings to support Greece’s €130 billion bailout, as demanded by the EU, a government source said.
Last minute snags
On Wednesday, party sources said senior members of the socialist and conservative camps had settled on the speaker of parliament, veteran socialist Filippos Petsalnikos, as the new Prime Minister - barring last-minute snags.
Papandreou then gave an emotional television address, supposed to be his last to the nation as premier, saying this deal had saved country’s membership of the euro zone. “I am proud that, despite the difficulties, we avoided bankruptcy and ensured the country stayed on its feet,” he said. “I want to wish the new prime minister success; I will support the new effort with all my strength.
Papandreou and Samaras then began talks with President Karolos Papoulias on the new coalition. However, before leaders of smaller parties could join them to seal the coalition, the meeting was abruptly halted, with large sections of Papandreou’s PASOK party and the conservative New Democracy refusing to back Petsalnikos.
“We wanted a strong a man who could handle all the economic issues,” a socialist lawmaker said. “This candidacy is so close to Papandreou’s policies, it does not signal the change the Greek people wanted.”
For its part, the EU needs to put out the fire in Greece to prove to international financial markets that it can tackle another blaze in Italy, a far bigger economy also in economic and political crisis.
Some lawmakers backed a return to the earlier plan, which had appeared stalled, of recruiting Papademos to give the new government the credibility that politicians lost long ago.
“The only solution is Papademos. If he accepts by tomorrow morning we will be able to form a strong government that will pull the country out of the crisis,” socialist lawmaker Spyros Vougias told the news agency.
On the streets of Athens, austerity-hit Greeks were exasperated by the political wrangling. “We are doomed to pay for the country’s debt for the next 30 years,” said Christos Koutras, 60, who sells lottery tickets in central Athens. “If Papandreou steps down and another guy takes over I will still have to pay for the country’s debt.”
Bank of Greece governor George Provopoulos made a rare intervention in Greek politics on Wednesday. “The uncertainty is hurting the economy and the banking system,” Provopoulos told the news agency. “There must be a strong government that will work hard to ensure the country’s future in the euro zone.”
Greeks have pulled their savings from banks over the past week because of the deepening political crisis and fear of an exit from the euro, banking sources said.