Greek left’s call to tear up bailout ‘destructive’

Greece sank deeper into crisis yesterday when the leftist candidate for prime minister set conditions for a coalition which the biggest party said would destroy the country.

Antonis Samaras, leader of the conservative New Democracy party which finished first in Sunday’s election, said Alexis Tsipras would drive Greece out of the euro with his demand that pledges made in exchange for an EU/IMF bailout be torn up.

“Mr Tsipras asked me to put my signature to the destruction of Greece. I will not do this,” Samaras said.

Tsipras, head of Syriza, the radical left coalition, yesterday received a mandate to try and form a government from the president and immediately renounced the bailout and threatened to nationalise banks.

Syriza took second place in the election in which voters abandoned New Democracy and the formerly dominant socialist Pasok party in droves, incensed by their acceptance of austerity measures in exchange for a bailout.

Samaras said he could support a minority government but not under Tsipras’s conditions, indicating the leftwing leader had very little chance of forming an administration, and making repeat elections in a few weeks increasingly likely.

Pasok leader Evangelos Venizelos, who negotiated the €130bn bailout, is equally unlikely to renege on it. He called yesterday for a pro-Europe unity government. Venizelos said he would set only one condition for joining a coalition: “That Greece stays in the euro and in Europe. We want things to get better, not worse, for Greeks.”

Tsipras told reporters: “The popular verdict clearly renders the bailout deal invalid.” His statement was likely to further unsettle jittery investors worried that Greece will again destabilise the eurozone, as it first did in 2009.

If Tsipras’s efforts fail, Venizelos will get his turn. If he cannot form a government, President Karolos Papoulias will call the parties together to make one last attempt at a unity government before calling fresh elections in around three weeks.

EU officials have rejected any compromise on the terms of the bailout. Without it, Greece would run out of money by the end of June, officials estimate.

A senior official in technocrat prime minister Lucas Papademos’s outgoing government said few of Tsipras’s inexperienced aides seemed to understand that money would dry up to pay government salaries and pensions if the EU and IMF stopped the bailout.

Theodore Couloumbis, political analyst for Athens-based think-tank Eliamep said many Greeks were in denial about the risk of being pushed out of the euro.

They thought “all we have to do is tell them we’ll jump from the 10th floor and they will have a safety net for us. I say ‘Beware, you may hit the ground and fall in many pieces’.”

— Reuters


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