New Greek Government Wins Crucial Vote of Confidence in Parliament

Posted June 21st, 2011 at 6:05 pm (UTC-5)
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Greek Prime Minister George Papandreou won a crucial parliamentary vote of confidence for his new government Tuesday, making passage of controversial economic reforms more likely.

Mr. Papandreou is appealing to lawmakers to pass his package of spending cuts, tax hikes, and sale of state assets. Passage would assure the next $17 billion installment of last year's $160 billion bailout from the European Union and International Monetary Fund.

Eurozone finance ministers have said they would approve the next payment only when Greece passes more economic reforms.

Mr. Papandreou has warned parliament that Greece could face bankruptcy and default if it fails to back his reforms and secure the loan payment.

Some in the opposition and some members of the prime minister's own Socialist Party say the reforms will not work. And millions of ordinary Greeks have been holding strikes and nationwide protests, angry that they are being asked to make more sacrifices.

Economic analysts say a default by Greece could spark another global financial disaster.