Greece: Coalition talks drag on as stocks tank

By Derek Gatopoulos

Associated Press

Published: Monday, May 14 2012 7:55 a.m. MDT

Pedestrians pass a plaque portraying a Greek one-drachma coin, which was replaced by the euro in 2002, outside Athens City Hall, on Monday, May 14, 2012. Greek party leaders are to resume power-sharing talks Monday as negotiations to create a government drag into a second week, raising the specter of fresh elections that could threaten the crisis-stricken country's international bailout and its membership of the euro.

Petros Giannakouris, Associated Press

ATHENS, Greece — Fierce political rivalries kept Greece from resolving its leadership crisis as an anti-bailout party refused Monday to return to power-sharing talks.

For ninth straight day, Greek party leaders were struggling to form a new coalition government, riven by differences over the harsh austerity measures demanded by international creditors in return for rescue loans. The impasse means the debt-stricken country is facing the prospect of another national election next month after holding an inconclusive ballot May 6.

Talks led by President Karolos Papoulias failed Sunday to break the impasse.

The turmoil in the small eurozone nation took a toll on markets across Europe, with shares on the Athens Stock Exchange down 4.4 percent at 584.29 in afternoon trading.

The conservative New Democracy party won the May 6 election, but the poll failed to produce an outright winner. But Alexis Tsipras, leader of the second-placed, left-wing Syriza party, has refused to join a coalition, demanding that the terms of an international bailout be scrapped or radically renegotiated.

"They are looking for an accomplice to continue their catastrophic work — we will not help them," Syriza spokesman Panos Skourletis told Mega television.

Many see fresh elections as inevitable. But a new poll could see anti-austerity parties gaining more support and prompt a rift in 17-nation eurozone and raise the risk of a Greek exit from the shared currency.

"Voices of support (in Europe) to Greece ... are becoming fewer and fewer, while there is a frenetic increase of those that are predicting the country's exit from the euro," an editorial in Greece's top-selling Ta Nea said. "The dramatic drop in state revenues during the election campaign and the serious souring of the atmosphere in Europe toward Greece mean that after almost certain repeat elections there will be a need for even tougher austerity measures."

Shut out of main debt markets, Greece is surviving on rescue loans from other euro countries and the International Monetary Fund, who have repeatedly warned that payments will only continue if the country continues its draconian cost-cutting program

Greece's two traditionally dominant parties, New Democracy and the Socialist PASOK lost significant support on May 6, as the bailed-out country suffers through a fifth year of recession, with more than one in five Greeks out of work.

Since the election, Syriza has gained support. In a survey published Monday, Syriza led with a projected 20.5 percent of public support, pushing New Democracy to second place with 19.4 percent, while PASOK was third with 11.8 percent. No margin of error was given in the Rass poll of 1,002 people, conducted May 10-11 for the Eleftheros Typos newspaper.

New Democracy and PASOK could form a government without Syriza if they had the support of the small Democratic Left party — but that small party has refused to join any government without Syriza.

"The president has invited us to a new meeting and I will attend," Democratic Left leader Fotis Kouvelis told Antenna television. "I will repeat my position, that without the participation of the second largest party, the government would not have sufficient popular and parliamentary support. "

.

Get The Deseret News Everywhere

Subscribe

Mobile

RSS