Greek Election Campaign to Begin This Week After Lafazanis Bid

by Paul Tugwell Originally published at Bloomberg
August 23, 2015

Alexis Tsipras, Greece's prime minister, center, speaks to lawmakers during a vote on a bailout deal in Athens, Greece, on Friday, Aug. 14, 2015. Greece's economy grew in the second quarter in a surprise surge just before the standoff between the government and its creditors forced officials to impose capital controls. Photographer: Yorgos Karahalis/Bloomberg *** Local Caption *** Alexis Tsipras

Alexis Tsipras, Greece’s prime minister, center, speaks to lawmakers during a vote on a bailout deal in Athens, Greece, on Friday, Aug. 14, 2015. Greece’s economy grew in the second quarter in a surprise surge just before the standoff between the government and its creditors forced officials to impose capital controls. Photographer: Yorgos Karahalis/Bloomberg *** Local Caption *** Alexis Tsipras

A group of rebel Syriza lawmakers will get a shot Monday to forge a government just three days after forming a new party, even as their leader admits they’ll fail, opening the way for a formal election campaign this week.
President Prokopis Pavlopoulos is set to invite former Energy Minister Panagiotis Lafazanis Monday to form a new administration within three days, part of the constitutional procedure set in motion by Greek Prime Minister Alexis Tsipras’s resignation last week.
After eight months in power, Tsipras stepped down Aug. 20, starting a process that will take Greeks back to the ballot box in September. Tsipras’s goal is to renew his mandate after his capitulation to the euro area’s conditions for a bailout caused his own Syriza party to split.
While Lafazanis said Saturday he’ll use the full three days to attempt to form a new administration, he already acknowledged defeat, noting that “our differences with the parties who voted for the memoranda are unbridgeable and there’s no chance of any cooperation.”
“Lafazanis will probably take all of the time he needs in order to attract publicity for his new party,” said Dimitris Sotiropoulos, an associate professor of political science at the University of Athens. “He’ll want to make his presence felt.”
Syriza Split
Elected in January on an anti-austerity platform, Tsipras suffered a revolt from within his own party after pushing through the kind of tax increases and spending curbs that he had been vociferously against while in opposition.
A group of at least 25 Syriza lawmakers led by Lafazanis abandoned the party to create a new movement called Popular Unity that is now the third-largest party in the Greek parliament.
“We won’t accept being in the euro area and having bailout programs imposed on us,” Lafazanis told reporters in Athens on Aug. 21 at the movement’s inaugural press conference. If resisting the bailout means Greece exiting the euro area “this is in no way a catastrophe. It’s a path that can create hope and prospects for our country.”
The invitation to Lafazanis to form a new administration will follow the efforts over the weekend of main opposition leader Evangelos Meimarakis to cobble together a big enough majority coalition to take a stab at governing. His lawmakers, combined with those of other pro-European opposition parties, total 106 in the 300-seat parliament. His three-day mandate ends Monday.
No Convergence
Tsipras declined Sunday an invitation to meet Meimarakis to discuss a possible coalition, telling him there’s no point for such a meeting as there’s no margin for convergence in the programs of the Syriza and New Democracy parties, a Greek government official said. Tsipras also told him that there’s no possibility to form a government from the present Greek parliament, the official said.
With little-to-no chance of Lafazanis succeeding, the formal election campaign process can begin by the end of the week and a caretaker government appointed. The most likely date for the national ballot is Sept. 20, government spokeswoman Olga Gerovasili said.
Greek media have meanwhile speculated that Vassiliki Thanou, president of the Supreme Court, is the most likely choice to be appointed caretaker prime minister. If so, she would become Greece’s first female premier.
A September election “would occur before the first program review in October and may well hamper and delay the technical work and political decisions necessary for its completion,” Fitch Ratings said Aug. 21.
Wieser Comments
Tsipras’s call for snap elections was expected and is welcome as it will achieve a “clearer structure” in the Greek government, Thomas Wieser, the Austrian who leads the European officials who prepare meetings of euro-area finance ministers, told radio Oe1 also on Aug. 21.
While the move may slow Greek economic overhauls in the short term, “what’s more important is how a new government, which many people expect to be led by Alexis Tsipras again, will execute the reform program,” Wieser said.
“What I’m hoping is that whoever wins the election will be serious and that Greece returns to growth and starts creating jobs,” Spanish Prime Minister Mariano Rajoy said Saturday. The agreements reached with Greece stand regardless of who is governing, Dutch Prime Minister Mark Rutte said a day earlier.
Reforms Necessary
European Stability Mechanism head Klaus Regling said that the next Greek government needs to bear in mind that reforms must be implemented to get help from its partners, Bild-Zeitung reported Saturday, citing an interview.
Tsipras remains popular with Greek voters, who gave Syriza 33.6 percent support, a 15.8 percentage-point lead over the main opposition New Democracy party, in a July 25 poll by Metron Analysis. Polls haven’t yet offered an indication of how much support Popular Unity would siphon off.
“Tsipras is likely to get what he wants: a return of a new Syriza government minus the old Syriza hard-liners,” said Jan Randolph, director of sovereign risk at IHS Global Insight in London. “Despite the trials, tribulations and political somersaults with the eurozone authorities and the International Monetary Fund over the last few months, the Greek people still trust him the most to serve them as best he can.”

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