Greeks go to polls on day of economic destiny

by editor | 17th June 2012 8:16 am

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Voters face stark choice between rejecting austerity and risking ejection from euro, or accepting punishing rescue deal

Polling stations have opened in Greece where voters face a stark dilemma between rejecting austerity and risking the country’s place in the eurozone, or choosing to stay in the single currency bloc despite the punishing terms of an international bailout package.

Riding a wave of anger to rise from obscurity to contender for power, leftist Syriza party leader Alexis Tsipras, 37, has promised to reject the 130bn-euro ($164bn) bailout if he wins the vote on Sunday.
 “The bailout deal is already in the past. It will be history for good on Monday,” Tsipras said earlier this week.

He has given himself a 10-day deadline for negotiations – in time for a summit of European leaders on June 28 and 29.

Tsipras says the mood in Europe is shifting against austerity and that the European Union and International Monetary Fund will not want to risk a Greek euro exit that would send shockwaves through the global economy.

On the political right, New Democracy leader Antonis Samaras, says a vote for the left would send Greece crashing out of the single currency and condemn it to even greater economic calamity.

With the election set to go down to the wire, European leaders also weighed in on Saturday, urging Greeks to vote with their heads.

The bailout would not be renegotiated, warned Angela Merkel, Germany’s chancellor, whose country’s wealth is vital to shoring up its weaker partners in the bloc.

“That’s why it’s so important that the Greek elections preferably lead to a result in which those that will form a future government say: ‘yes, we will stick to the agreements’,” Merkel told a party conference of her Christian Democrats.

Jean-Claude Juncker, the head of the group of eurozone finance ministers and prime minister of Luxembourg, said there would be serious consequences if Syriza secured victory.

“If the radical left wins – which cannot be ruled out – the consequences for the currency union are unforeseeable,” Juncker told Austrian newspaper Kurier.

“We will have to speak to any government. I can only warn everyone against leaving the currency union. The internal
cohesion of the eurozone would be in danger.”

European leaders have warned that Greece must respect its international debt commitments, and the EU and the IMF have suspended payment of installments of the country’s rescue loan until after the elections.

‘Will not exit euro’

Tsipras says Greece’s lenders are bluffing when they threaten to turn off the funds if Athens reneges on the terms of
the bailout – tax rises, job losses and pay cuts that have helped condemn the country to five years of recession.

He says the eurozone will not allow a Greek exit, fearing the pressure it would heap on the far larger economies of Spain, which has already secured a $125bn rescue for its banks, and Italy, which could be next to seek a bailout.

Greeks say they want to keep the euro, but they do not want the pension, wage and jobs cuts imposed by the bailout package, and which have seen living standards plummet and unemployment reach almost 23 per cent.

At his final election rally in Athens, Tsipras accused Samaras, of defending “Merkel’s Europe of the past”.

“We guarantee the Europe of the future,” he said.

Samaras wants a more moderate renegotiation of the deal and accuses Tsipras of playing with fire. At his rally on Friday, he said: “We will exit the crisis. We will not exit the euro. We will not let anyone take us out of Europe.”

Sunday’s vote is a rerun of a May 6 election that produced stalemate, when anger at the close-knit political clique that has run Greece for years propelled Syriza from the political fringe into second place.

Opinion polls published until a ban two weeks ago put the two parties almost neck and neck.

No one party is expected to win enough votes to secure a majority in parliament, and the days to come are likely to be dominated by coalition talks, while a euro exit is a real but extreme and certainly not immediate possibility.

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