Tags: EU | Greece | Elections

Greek Prime Minister Vows to Press Ahead with Austerity

Monday, 08 Nov 2010 07:21 AM

Greece's prime minister vowed to press ahead with painful austerity measures to pull the debt-strapped country out of a severe financial crisis, dropping a threat to call snap elections after his party retained a slim lead in local government polls.

"We know that change is not easy. But it was for this change that the Greek people brought us to power a year ago. And today it again confirmed that it wants this change," George Papandreou said in a live televised speech late Sunday night.

With nearly all returns counted Monday, Papandreou's Socialists led a key race for regional governor in greater Athens Sunday but lost significant ground elsewhere to the main opposition conservative party, while turn-out plunged. A runoff vote will be held next Sunday.

Papandreou had warned he would call a snap general election unless his party-backed candidates won clear backing in Sunday's vote for 13 regional governors and 325 mayors, citing the need for public support for austerity measures taken in return for a euro110 billion ($155 billion) package of rescue loans from the European Union and International Monetary Fund.

"Tomorrow we will continue our work, remaining dedicated to the great challenge, to the salvation of the country and to creating a better country with a viable economy in which we choose our own fate, far from supervision and economic dependence," Papandreou said.

With more than 95 percent of votes counted, PASOK-backed candidates were ahead in seven of the regional governor races, including in Athens, the country's largest administrative region. But the conservatives made significant gains compared to their crushing defeat in the Oct. 2009 general elections that brought Papandreou to power, and political leaders on all sides claimed the results as a success.

Legions of voters also showed their displeasure for the government — whose austerity policies have included cutting civil servants' salaries, hiking taxes and freezing pensions — by staying away from the ballot box. In a country where voting is compulsory and elections generally well-attended, the abstention rate ran at nearly 40 percent.

"The government did not get the blank check it was asking for. The blackmail did not work," said conservative leader Antonis Samaras. "It got its answer from all those who live under the threat of unemployment and business failures."

Opposition parties had campaigned against the terms of the bailout loans, adding pressure on Papandreou, who has faced months of disruptive strikes and protests as a deepening recession caused a surge in unemployment and small business closures.

"One year after our heavy election defeat, we have almost erased the gap in support with the ruling party — an unprecedented accomplishment for an opposition party," Samaras said. "The people demand an exit from the crisis through growth, not suffocation."

Senior conservative official Evripidis Stylianidis said PASOK had seen its lead of nearly 11 percentage points over the conservatives dwindle to just 2.5 percentage points.

Papandreou's early election threat spooked bond markets concerned about Greece's ability to cope with the massive debts that triggered a financial crisis and affected the 16-nation euro currency. The uncertainty sent borrowing costs sharply higher, with the interest-rate gap between Greek 10-year bonds and Germany's benchmark equivalent exceeding 9 percentage points on Friday.

In the race for Athens mayor, a right-wing extremist appeared set to win a seat on the local council for the first time. Nikolaos Michaloliakos, leader of the far-right Golden Dawn group was garnering over 5 percent. Michaloliakos capitalized on increased tensions with illegal immigrants, including attacks on foreigners by right-wing vigilantes, to nearly quadruple the extreme right's showing from the last election, in 2006.

Conservative incumbent Nikitas Kaklamanis was leading the race for the capital's major with nearly 35 percent to 28 percent for center-left challenger Yiannis Kaminis and the two will face off in the runoff.

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Greece's prime minister vowed to press ahead with painful austerity measures to pull the debt-strapped country out of a severe financial crisis, dropping a threat to call snap elections after his party retained a slim lead in local government polls. We know that change is...
EU,Greece,Elections
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2010-21-08
Monday, 08 Nov 2010 07:21 AM
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