Greece’s President Tries to Broker Coalition Government

Posted May 13th, 2012 at 3:25 pm (UTC-5)
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Greece's president has so far failed in his last-ditch effort to broker a new coalition government for the debt-stricken nation.

President Karolos Papoulias held talks Sunday with the heads of the top three political parties – the conservative New Democracy party, the radically liberal Syriza party and the socialist PASOK party. He was also meeting with heads of smaller parties that won parliamentary seats in the May 6 election.

No party won enough votes to govern on its own.

The talks are the president's final bid to avoid a new election. The leaders of all three major parties tried but failed to find enough support to form a majority coalition.

PASOK leader Evangelos Venizelos said he had “limited optimism” after Sunday's talks.

The president has until Thursday to broker a deal. If he fails, Greece will have to hold a new vote next month.

The New Democracy and PASOK parties could form a coalition if the small Democratic Left party agrees to link to them, but that party has so far refused to join unless Syriza does, too. And Alexis Tsipras, head of the far-left Syriza party, says he will not join or support any government that agrees to continue the EU bailout package.

The key point of contention centers on the previous Greek government's agreement to demands from its international lenders and European neighbors. They insisted on sharp austerity measures in exchange for approval of the country's second bailout – emergency loans to avoid default – in two years.

The New Democracy and PASOK parties support sharp spending cuts, but the Syriza party says voters repudiated the austerity agreement. Greeks have taken to the streets repeatedly in massive, sometimes violent protests against the bailout plan, which raised taxes, reduced pensions and eliminated thousands of government jobs.

European leaders have told Athens the austerity measures must be carried out if the bailout loans are to continue. Financial analysts say the alternative is for Greece to default on its financial obligations and become the first country to leave the 17-nation European currency union.