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Greece Heading Towards Re-Elections & Euro Exit

By: EW News Desk Team Date: 9 May 2012

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09 May 2012

Greece’s status in the European Union has once again been thrown into doubt, after Coalition of the Radical Left leader Alexis Tsipras – who was handed a mandate to form a coalition government late Tuesday – vowed to rip up the nation’s bailout agreement with its debtors and cancel all austerity cuts and reforms.

Tsipras, whose party came in second during the Sunday elections, was tasked with forming the government by President Karolos Papoulias after the centre-right New Democracy party had failed to break the political impasse that was surrounding the parliament.

Tsipras then proceeded to say that he would not work with the traditional big two political parties in Greece, New Democracy and PASOK, unless they rejected the IMF and EU bailout deal and abolish the harsh austerity measures that were imposed on the nation.

"If they truly regret what they have done to the Greek people…the two party leaders (from New Democracy and PASOK) should rescind their letters to creditors that guaranteed full support of the bailout terms,” he said, as cited by TIME.

The Coalition of the Radical Left, also known as Syriza, received 16.8 percent of the parliamentary votes on Sunday. The winning party, New Democracy, on the other hand limped home with just 18.89 percent of the votes. PASOK, the once-mighty Socialist party that ran Greece for many of the past 30 years, came in an embarrassing third with 13.2 percent of the votes. Syriza now has up till this Thursday to try and form a government before the responsibility will fall to PASOK.

Most analysts though believe that none of the parties will be able to form a government and re-elections would be needed by the end of the month.

"Everyone is pretending to form a government but what they're actually doing is preparing for elections again. You need some time for political development to avoid the gridlock and the chaos that we're seeing now but that's never going to happen if you're forever chasing the next election,” said Platon Tinios, an economist at the University of Piraeus.

Still, Tsipras has urged New Democracy Leader Antonis Samaras and PASOK leader Evangelos Venizelos to renege on their support for the bailout commitments, and to "honestly repent for their disastrous choices that tore our society apart."

Additionally, Tsipras also called for Eurozone leaders to stop “blackmailing” Greece with threats of a loss of EU membership.

“This crisis isn’t just Greek, it’s European…, there will either be a collective, sustainable and fair European solution to the public debt issue or it will collectively fall apart,” he said, as cited by Forbes.

In response, German politicians have warned Greece that the country would not receive a cent more in aid unless it fulfils all the conditions of the bailout.

"The agreements must be respected. I don't think we can or should renegotiate," said Martin Schulz, a German politician and president of the European Parliament, on a visit to Berlin.

“Our position is unchanged. Aid can only flow if the conditions are met,” added Gerda Hasselfeldt, a senior member of the Bavarian Christian Social Union (CSU), as quoted by Reuters.

New Democracy leader Antonis Samaras also blasted Tsipras for being "unbelievably arrogant," and warned that his actions might "drag the country into chaos" and see it expelled from the eurozone.

"Mr. Tsipras is doing everything to prevent a government being formed," Samaras said. "Nothing can be done if we leave the euro, because the country's catastrophe would be certain and unprecedented."

"He is asking me to place my signature on the destruction of Greece. And that I will not do."