Greece parties look to seal coalition

 

 

Antonis Samaras's New Democracy won 129 seats in the 300-seat assembly

Talks on the formation of a government in Greece are entering a second day, amid intense pressure from world powers and financial markets.

New Democracy, the largest party after Sunday's election, says it has a deal with third-placed Pasok.
However both would prefer more partners to create a stronger government.
Its first priority would be the bailout agreement reached with the EU and IMF, which all Greek political parties want to be renegotiated in some form.
The New Democracy conservatives said on Monday they had an initial deal with the socialists Pasok, after New Democracy's leader Antonis Samaras held a day of meetings and called for a government of "national consensus".
One senior New Democracy official told Reuters news agency an announcement was expected soon, involving Pasok and possibly another, smaller leftist party.
"We are going to clinch a deal tomorrow [Tuesday], we will form a government," the official said. "Pasok will participate more than symbolically... They will participate actively."
'Torturous reality' The BBC's Chris Morris in Athens says the parties involved say they want a government as quickly as possible but they are haggling and want to get the conditions right.
He says they want as many parties in as possible, but with more parties come more conditions.

Bailout deal - Greek pledges

• Cut 15,000 state sector jobs this year - aiming for 150,000 to be cut by 2015
• Cut minimum wage by 22%, to about 600 euros a month
• Pension cut worth 300m euros this year
• Spending cuts of more than 3bn euros this year
• Liberalise labour laws to make hiring and firing easier
• Boost tax collection
• Carry out privatisations worth 15bn euros by 2015
• Open up more professions to competition, eg in health, tourism and real estate
• Greece aims to cut its debt burden to 116% of GDP by 2020

• European press: Hollow victory

Then the question will come, our correspondent says, of just how strong the coalition will be, as there will be a lot of pressure on it from both inside and outside parliament.

Pasok has maintained it wants the party that finished second in the election, the anti-austerity Syriza, to be part of the government, but Syriza leader Alexis Tsipras has ruled this out.
The moderate Democratic Left party has indicated it may give conditional support to a Samaras-led government.
The election saw New Democracy take 129 seats in the 300-seat assembly, with Syriza on 71, Pasok on 33 and the Democratic Left on 17.
World powers have urged Greece to move swiftly to form a government.
On Monday, markets initially reacted positively to the election result but that quickly waned.
All the parties in the election wanted a renegotiation of the bailout terms, but differed on the extent.
Mr Samaras says he will honour the agreements Greece made earlier, but wants an easing of the terms of the bailout, "so the Greek people can escape from today's torturous reality".
The senior New Democracy official told Reuters there would be a quickening of a privatisation programme but that it would prefer a scheduled 11.7bn euros ($14.7bn) of austerity cuts to be spread over four years, not two.
Germany has indicated there will be few concessions on the terms.
German Chancellor Angela Merkel warned: "Elections cannot call into question the commitments Greece made. We cannot compromise on the reform steps we agreed."
However, the US said it might support a review of the terms.
US Treasury Under Secretary for International Affairs Lael Brainard said: "We can expect to see on the part of the European partners and the IMF recognition that Greece's programme has gone off track for some period of time, in part because they had a protracted political process and have not had a government."
Two international bailouts have been awarded to Greece, an initial package worth 110bn euros (£89bn; $138bn) in 2010, then a follow-up last year worth 130bn euros, but they come with tough austerity measures attached.