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Europe
Greek PM faces crucial vote of confidence
Papandreou seeks parliamentary support for new round of spending cuts as protests against austerity measures continue.
Last Modified: 21 Jun 2011 20:03

Protesters have massed outside Greece's parliament as legislators are set to hold a key vote of confidence in Prime Minister George Papandreou's government.

The parliamentary vote, scheduled for Tuesday night, is a hurdle Papandreou must clear to gain support for a new round of austerity measures needed to secure a $17bn bailout.

Facing public protests and dissent in his Socialist party, Papandreou reshuffled his cabinet last week and called the confidence vote in an effort to push his reforms through the legislature this month.

He also urged Greeks to support the deeply unpopular tax hikes, spending cuts and privatisation plans in order to avoid a "catastrophic" bankruptcy.

But for 28 consecutive days, demonstrators have been camping out on the central square in Athens and held nightly rallies in front of the parliament building, protesting against the planned austerity measures.

"I am not expecting anything from this government, nor are the Greek people, because they have lied to the people too many times," said protester Kostas Naupliotis at the rally outside parliament as the ruling and opposition parties deputies were holding debates inside ahead of the vote.

"Those who are voting in there should be punished. This vote is treason, it is against the nation. They should not vote [for the government)]" said another protester, George Stirianis.

'Majority likely'

Al Jazeera's Tim Friend, reporting from Athens, said the protest was peaceful, but that riot police equipped with teargas were deployed in the side streets in case events would run out of control.

"The ruling party believes they can win the vote on Tuesday but they have a slim majority." he said.

Papandreou's Socialist party holds a five-seat majority in the 300-member legislature, and a simple majority is needed to pass.

 
Al Jazeera's Tim Friend reports from Greece ahead of the vote

"Indications over the last 24 hours or so have certainly been that the government will survive, if only because the alternative would be so dire,'' said Beat Siegenthaler, an analyst at UBS, a global financial service firm.

Papandreou's popularity has been hammered by the latest austerity measures, with an opinion poll published Tuesday giving the Socialists a 20.1 per cent approval rating. Rival conservatives faired marginally better, at 21 per cent, in the GPO survey for private Mega television of 1,000 adults.

If Papandreou's cabinet gets the necessary parliamentary support, he is to put the package up for a vote next week.

In the lead-up to the vote of confidence, Japan announced it would support the debt-ridden Greek economy.

The Japanese government has already bought more than $1.4bn in bonds to help bail out struggling European economies.

"Japan has been making its own contributions to bring stability to European financial conditions, such as by buying debt [issued by the rescue fund] during efforts to support Portugal," Yoshihiko Noda, Japan's finance minister, said on Tuesday.

"We'd like to continue those efforts," he said.

Loan decision delayed

The pledge of support comes a day after eurozone finance ministers postponed a final decision on extending $17bn in emergency loans to Greece, until it introduces the austerity measures.

The ministers said on Monday that they expected to pay the next tranche of a $157bn bailout package, backed by the European Union and the International Monetary Fund, by mid-July.

Greece has said it needs the loans by then to avoid defaulting on its debt.

Keeping up their pressure on Athens, the ministers insisted that disbursement would depend on the Greek parliament first passing laws on fiscal reforms and selling off state assets.

"To move to the payment of the next tranche, we need to be sure that the Greek parliament will approve the confidence vote and support the programme, so the decision will be taken at the start of the month of July," Didier Reynders, Belgian finance minister, said after the eurozone meeting in Luxembourg.

Al Jazeera's Jonah Hull, reporting from Luxembourg, said the decision was sending a message to Greece.

"If they want to continue getting money from the eurozone they have to help themselves and enact these stiffer austerity measures and privatisation to raise money on their own behalf.
 
"Also there's a message for the financial market, which is extremely jittery at the moment, to say 'look we are not just throwing good money after bad in helping Greeks but we are also trying very hard to keep their message on target in terms of bailout'."

"Showing that we are split is not helping us at all," he said.

Cinzia Alcidi, a research fellow at the Center for European Policy Studies, told Al Jazeera from Brussels that Greece's debt is unsustainable.

"We will not find any solution until this debt is reduced," she said.

"Either somebody pays for Greece or we organise a debt reduction with the participation of the private sector."

Source:
Al Jazeera and agencies
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