Greek deal in MPs' hands now

Greek Finance Minister Euclid Tsakalotos leaving after a meeting at the Syriza party headquarters in Athens yesterday. The ruling party and its junior coalition ally held meetings to prepare for Parliament sittings to pass laws which include plans fo
Greek Finance Minister Euclid Tsakalotos leaving after a meeting at the Syriza party headquarters in Athens yesterday. The ruling party and its junior coalition ally held meetings to prepare for Parliament sittings to pass laws which include plans for tax hikes, pension reforms and tighter supervision of government finances.PHOTO: BLOOMBERG

PM Tsipras has to overcome dissent and pass tougher measures fast

ATHENS • Lawmakers from the Greek ruling Syriza party and their allies argued behind closed doors yesterday about whether to back sweeping reforms the government must ram through Parliament as it races to meet the terms of an unpopular bailout deal.

Having staved off financial meltdown with a new agreement from Greece's creditors, Prime Minister Alexis Tsipras has less than 48 hours to smother dissent from hardliners and pass measures tougher than those rejected in a referendum days ago.

Syriza and its junior coalition ally held separate meetings to prepare for Parliament sittings to pass the laws, which include plans for tax hikes, pension reforms and tighter supervision of the govern-ment's finances.

It was a spectacular turnaround for Syriza, a party voted into power in January promising to end years of cuts and recession in a country where a quarter of the people are unemployed.

There was some speculation, including in Germany's mass-selling Bild newspaper, that Mr Tsipras could resign.

Comparing the challenge facing the Greek government to the Gordian knot of mythology that was impossible to untie, Interior Minister Nikos Voutsis was nevertheless confident that Mr Tsipras would be able to muster enough votes in Parliament. "The decisions that will facilitate a return to normality will take place," Mr Voutsis told reporters.

But investors were less sure. European shares edged lower yesterday after a four-day rally amid uncertainty over whether the reform measures would be passed in time.

The party's junior coalition partner promised to support the government, with the ambiguous caveat that it would vote only for bailout measures agreed before last weekend's summit in Brussels, which were less stringent.

"We are committed to voting for what we decided in the council of the political leaders and only that, no other measures that are imposed," Mr Panos Kammenos, head of the right-wing Independent Greeks, told reporters.

He and a parliamentary spokesman for Syriza railed against what he described as a "coup" by creditors to force Greece to accept harsh reforms, while opponents of the new measures are planning to hold strikes and protests in the coming days.

Mr Tsipras will probably have to sack some hardline ministers and count on opposition lawmakers to pass the reforms, which could be clubbed together in one Bill today.

The Prime Minister will "probably" reshuffle the Cabinet today, Economy Minister George Stathakis told Bloomberg TV.

Mr Tsipras needs 151 of 300 lawmakers to pass the reforms and, with the votes of his own party and allies, theoretically has 162.

"Mr Tsipras has decided to first pass the measures in Parliament with the support of the opposition parties and then attempt to solve the Gordian knot," centre-right Kathimerini newspaper said.

Bank of England governor Mark Carney also drew on Greek mythology to underscore the scale of the challenge, saying it needed a "Herculean" effort from all sides for the deal to work.

Euro zone finance officials are struggling to find a way to give Greece bridge financing to keep the country afloat while a third bailout package is negotiated, especially to pay back the loans owed to the European Central Bank next week.

REUTERS, BLOOMBERG

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A version of this article appeared in the print edition of The Straits Times on July 15, 2015, with the headline 'Greek deal in MPs' hands now'. Print Edition | Subscribe