Brussels, 07/05/2012 (Agence Europe) - On Monday 7 May Pia Ahrenkilde-Hansen, a European Commission spokeswoman, said that the Commission expected Greece to fulfil its promises under the bailout programme after the defeat in Sunday's general election of the two political parties that backed the second Greek bailout. With only 149 of the 300 seats in parliament, Conservative party New Democracy (108 seats) and Socialist party PASOK (41 seats) will have to get a third party to join them to form a government. Five austerity-hostile parties hold 151 seats between them, including a neo-Nazi party. If the pro-Europe leftist party Dymar (19 seats) refuses to join the government, it will not be easy to drum up a coalition. Fearing a return of instability, European stock exchanges went down on Monday morning.
Austerity memorandum on the back burner?
New Democracy leader Antonis Samaras now has three days to form a government. He said on Sunday that he was prepared to negotiate with any party except the far right party (21 seats), adding that he understood people's anger, but New Democracy would not leave Greece without a government. He suggested a government of national unity to keep Greece in the euro and promised to change the austerity memorandum policy to bring back economy growth and peace and calm. Under the austerity memorandum, Greece has to make a further €11 billion of spending cuts by the end of June this year. If Samaras does not manage to form a coalition, then the far left party Syriza (52 seats), which opposes the austerity memorandum, would try to form one. Outgoing Greek Prime Minister Lucas Papademos called for stability, confidence and solidarity in order to carry out the measures to restore the economy.
EU cautiously recommends stability.
On Monday, the EU institutions were taking a cautious approach, pointing out Greece's international obligations. Ahrenkilde-Hansen said that there was not yet a new government, but the European Commission hoped and expected the future government to respect Greece's interests and commitments. She hoped the political parties would work fast and responsibly to form a stable government, adding that the Commission was prepared to help Greece with the reforms currently under way under the second structural adjustment package which, she said, provided a foundation for economic recovery, sustainable growth and job creation.
Amadeu Altafaj Tardio, spokesman for Euro Commissioner Olli Rehn, said the EU was sure that Greece would remain in the eurozone, but everyone had to do their duty. He said a lot was being done at the Commission to help Greece and there was plenty of solidarity flowing in either direction. He explained the view of the country's international lenders that introducing reforms was essential if the Greek debt was to be made affordable.
EU Internal Market Commissioner Michel Barnier said that the Greek elections showed that people were being stretched to breaking point and the EU and IMF had to examine the situation in detail. On the question of easing up on the austerity programme, Barnier said that the reforms in Greece had to continue, but there were mechanisms for assessing, changing and altering the Greek bailout programme to help the country's political parties to form a national unity government.
Less alarmist, the president of the European Parliament, Martin Schulz, said that the outcome of the Greek elections should be calmly examined to see what is feasible and people should not over-react. He said the aim in Greece now was to form a coalition government that would work to ensure Greece remained committed to the European Union.
Steffen Seibert, a German government spokesman, said that the measures decided upon have to be introduced and the second bailout is the best way to get out of crisis. He said Germany would help Greece, no matter who is in government, as long as the bailout measures are applied. Seibert said the bailout included huge solidarity from Europe, along with huge efforts from the Greeks, in order to restore the country's long-term competitiveness and financial stability. (CG/transl.fl)