Greece’s New Democracy sets ambitious goals in second term

The party has its work cut out if it is to follow through on promises to raise investment, economic growth and wages while lowering debt and unemployment.

Greek Prime Minister-elect Kyriakos Mitsotakis addresses supporters outside party headquarters late on June 25, 2023 [John Psaropoulos/Al Jazeera]

Athens, Greece – Jubilant supporters clamoured around New Democracy’s headquarters, floodlit in the party’s trademark blue, to celebrate Prime Minister-elect Kyriakos Mitsotakis’s return for a second term.

“For the second time, all of Greece is blue,” Mitsotakis said on Sunday night, referring to the electoral map, which showed only one of 60 electoral districts in the opposition Syriza party’s red.

“The Greek people trusted us for a second time with a comfortable majority, just as we asked. It gave us a powerful mandate,” he said.

His supporters chanted back: “You are and you will be the prime minister.”

New Democracy won 40.5 percent of the popular vote, giving it 158 seats in the 300-seat parliament. Syriza trailed with 17.8 percent of the vote and may now go through a leadership challenge.

The result from Sunday’s elections came as no surprise. New Democracy won a similar victory five weeks earlier but chose not to form a government under the system of proportional representation in force at the time, which gave it slightly less than a majority in parliament with 145 seats.

Mitsotakis held out for a second election, which triggered a new electoral system called enhanced proportionality. It gives the top party a bonus of up to 50 seats, making governments easier to form.

Mitsotakis came to power in 2019, promising to cut taxes imposed during Greece’s depression after the 2009 global financial crisis.

Mitsotakis did cut business and payroll taxes, but his first term was consumed by other concerns – the COVID-19 pandemic, tensions with Turkey and the Ukraine war, which brought energy inflation.

These crises convinced many voters that Mitsotakis is a competent manager capable of handling difficult situations and that he deserves another chance to implement his economic reform programme. His support has been especially strong among small businesses and the self-employed, who together provide 90 percent of private sector employment.

“I am not an economist, but the economy is mainly a matter of trust. People who are in the marketplace need to be able to trust the government. That only happens with New Democracy,” said Chronis Akritidis, a self-employed topographer and New Democracy supporter.

“Mitsotakis has won a very big gambit – to do what he says and to convince people to trust him. That is very difficult to do.”

Judicial and party representatives count ballots at Athens’s 681st electoral centre [John Psaropoulos/Al Jazeera]

Pensions out quickly

Yiorgos Stanotas, a plastics factory owner, is also a fan. “Greece has a deep state that is difficult to fix, but at least [New Democracy] tries to get some things done. The things I appreciated most were e-government, and the fact they got pensions out to people quickly.”

Mitsotakis promised on Sunday “to close once and for all the vicious cycle of division and toxicity that started a decade ago”.

He has a promising start. Greece achieved the highest economic growth rate in the European Union last year – 5.5 percent – and is set to top that again this year. But critics say it was largely achieved by an overreliance on tourism and real estate sales.

New Democracy has made ambitious promises for its next term. It wants to raise public investment by 70 percent, attract record foreign direct investment, boost exports to 60 percent of GDP and raise average wages by 30 percent. It hopes to maintain an average annual growth rate above 3 percent.

But Greeks who did not vote for New Democracy have their eyes on another economic trend – soaring energy inflation.

“The issue is not just to give someone a raise. It’s also about having quality of life; otherwise, what’s the point?” said Athanasios Tsoukalas, a pensioner who supported neither New Democracy nor Syriza.

“If someone gives you a raise and takes it back tenfold, that’s not a raise. That’s a bait and switch,” he added.

Greece saw 7.2 percent inflation last year, lower than the EU average of 9.2 percent, but it also has one of the lowest per capita rates of GDP in the EU.

‘The party is over’?

Greece’s debt is another enormous economic challenge, and Mitsotakis added to it when he implemented 66 billion euros ($72bn) in tax breaks and subsidies to help people weather the pandemic and energy inflation. It now stands at 400 billion euros ($438bn), almost twice Greece’s GDP.

“Because [New Democracy] has got 40 percent, it feels it has the right to do anything,” said Athanasios Drivas, a Syriza party functionary.

“I don’t know if people realise that all this money dropping from the ceiling is borrowed and paid for with high interest. I don’t know if they realise that at some point our friends and partners are going to tell us that the party is over.”

New Democracy has promised to bring the debt to 160 percent of GDP by the end of its term and to 120 percent by the end of the decade.

Some opponents of New Democracy, and even some supporters, are worried the party has become too powerful.

Voters abandoning Syriza seem to have scattered in all directions, but some chose to back smaller parties, and many will enter parliament for the first time.

Among them are the Spartans and Niki, both nationalist parties to the right of New Democracy, now crowding the same part of the ideological spectrum as Greek Solution. Also entering parliament for the first time is Sailing to Freedom, a left-wing party. Together, the four claimed 16 percent of the vote and will have 42 seats in the new parliament.

The fact these voters did not heed New Democracy’s call but went instead for new, small parties was not lost on Mitsotakis.

“This political dominance is not a recipe for arrogance or a blank cheque,” Mitsotakis warned outside party headquarters on election night.

“People have a lot of problems, and they demand that we lean into the task of solving these problems. Today, I am the prime minister of all Greeks, and I am expressing the expectations of all those who didn’t support us. … I am sure we shall once again vindicate people’s expectations with our second term.”

Source: Al Jazeera