Greek PM Renews Call For National Consensus On Reforms
By Alkman Granitsas
Of DOW JONES NEWSWIRES
ATHENS (Dow Jones)--Prime Minister George Papandreou Wednesday renewed his call for a national consensus to address the country's financial crisis, one day after failing to find common ground with opposition lawmakers over the government's latest austerity measures.
Speaking after a meeting with Greece's president, Papandreou also reiterated the government's determination to press ahead with its reform program.
"We will implement these decisions, as I have emphasized previously, with the widest possible understanding and consensus, within our party, with the other [political] parties and, of course, the Greek people," Papandreou told journalists.
He didn't respond to questions over whether the government is considering staging a popular referendum on its austerity program, a proposal made by Greece's biggest business lobby and the subject of media reports Wednesday.
Earlier Wednesday, Greek newspapers reported that the government was examining such an option, which fuelled speculation in financial markets that Greece might be considering snap elections.
But Greek officials rejected the rumors. "There are no plans to call early elections," a senior government official told Dow Jones Newswires. "These rumors are unfounded."
Earlier this week, Greece's cabinet broadly approved some EUR6.4 billion of new austerity measures to bring the budget deficit back on track this year, as well as steps to speed up the government's ambitious privatization drive.
In the next 10 days, the government will also detail a further EUR22 billion in new spending cuts and tax increases to bring the budget deficit below 1% of gross domestic product by 2015.
In May last year, Greece narrowly avoided default with the help of a joint EUR110 billion bailout from its fellow euro-zone members and the International Monetary Fund. In exchange, it had to commit to fixing its public finances and undertaking far-reaching reforms.
Since then, Greece has narrowed its budget gap by about a third, to 10.5% of GDP last year, but has failed to convince investors it is able to service its giant public debt.
Faced with prohibitively high borrowing costs, Greece is now seeking an additional EUR60 billion in aid to cover its financing needs for 2012 and 2013 when the money from the current loan-program runs out.
However, the new measures, which are seen as a quid-pro-quo for further assistance, have also met stiff resistance in Greece. A series of meetings between Papandreou and the heads of Greece's opposition parties failed to reach any consensus, with the head of the main opposition party, New Democracy leader Antonis Samaras, flatly rejecting the government proposals.
Although the socialist government holds a six-seat majority in Greece's 300-member parliament, internal conflicts within the ruling party raise the specter of defection when the package comes up for a vote some time next month. The rejection by the opposition piles further pressure on the government.
Greece's unions have also weighed in. The two main umbrella unions--private-sector GSEE and public-sector ADEDY--say they will stage a series of general strikes in June to oppose the measures.
Greece's smaller unions, especially in state-owned companies slated for privatization, have also voiced their opposition. Workers at Hellenic Postbank (GPSB.AT), where the government wants to sell off its 34% stake this year, have occupied the company's main premises since Tuesday.
Likewise, workers at state-gambling monopoly OPAP SA (OPAP.AT), which is due to be privatized at the start of next year, have announced a 24-hour strike Wednesday.
Other strikes have also been announced by the unions representing workers at state-owned utility Public Power Corp SA (PPC.AT), and at former telecom monopoly Hellenic Telecommunications Organization SA (HTO.AT), where the government is also planning to cut its holdings.
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Il punto della situazione.
