Greek vote eases Eurozone fears

The New Democracy party came in first in Greece’s election today and immediately proposed forming a pro-euro coalition government – a development that eased, at least briefly, deep fears that the vote would unleash an economic tsunami.

The election was seen as crucial for Europe and the world, since it could determine whether Greece was forced to leave the joint euro currency, a move that could have potentially catastrophic consequences for other ailing European nations and the global economy.

As central banks stood ready to intervene in case of financial turmoil, Greece held its second national election in six weeks after an inconclusive ballot on May 6.

With 37.4% of the vote counted, official results showed the conservative New Democracy with 30.5% of the vote, ahead of the radical anti-bailout Syriza party’s 26% and the pro-bailout Socialist PASOK with 12.9%.

Although official projections tonight showed that no party will win enough seats in the 300-member parliament to form a government on its own, Greece’s two traditional parties – New Democracy and PASOK – will have enough seats to form a coalition together.

“The Greek people today voted for Greece to remain on its European path and in the eurozone,” New Democracy leader Antonis Samaras said, adding that voters chose “policies that will bring jobs, growth, justice and security”.

His party beat Syriza, which wanted to cancel Greece’s international bailouts. Syriza chief Alexis Tsipras has conceded the election.

The parties vying to win have starkly different views about what to do about the €240bn in bailout loans that Greece has been given by international lenders.

Greece has been dependent on rescue loans since May 2010, after sky-high borrowing rates left it locked out of the international markets following years of profligate spending and falsifying financial data. The spending cuts made in return have left the country mired in a fifth year of recession, with unemployment spiralling to above 22% and tens of thousands of businesses shutting down.

The party that comes first in today’s vote gets a bonus of 50 seats in the 300-member Parliament and gets the first try at forming a new government with a majority in Parliament. If they fail, the next highest party gets to try.

Earlier about 10 men armed with sledgehammers and wooden bats attacked a polling station in central Athens, wounding two policemen guarding it and setting fire to the ballot box shortly before polls closed.

Greek police were also investigating the discovery of two unexploded hand grenades outside private Skai television station on the outskirts of Athens.