John Kolesidis/Reuters
Evangelos Venizelos, right, head of the Pasok party,
met Fotis Kouvelis, the head of the Democratic Left, in Athens on
Tuesday.
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Antonis Samaras,
the leader of the New Democracy Party, was sworn in Wednesday afternoon
as prime minister in a televised ceremony conducted by Archbishop
Ieronymos of the Greek Orthodox Church. Mr. Samaras is preparing to work
with two other parties that garnered substantial votes in Sunday’s
pivotal parliamentary elections.
But whether his coalition government will last more than a few months,
or succeed in renegotiating some of the harsh austerity terms of
Greece’s multibillion-euro bailouts with its European partners, remained
an open question.
Together with the Greek Socialist party known as Pasok and the
Democratic Left, a small party that won only 16 percent of the vote, Mr.
Samaras is maneuvering to form an airtight majority coalition in
Parliament that he hopes will resist opposition from the popular
far-left Syriza party, which has said it will fight if the new
government does not repudiate the most onerous terms of Greece’s loan
deals.
With the economy in a downward spiral and the government bleeding cash,
Mr. Samaras’s government can “incrementally develop a certain sense of
stability and certainty, but it will always be vulnerable to any shock —
whether political or economic,” said Marco Vicenzino, director of the
Global Strategy Project, a geopolitical risk analysis firm based in
London.
Evangelos Venizelos, the Greek Socialist leader, said talks to select
members of a new cabinet would be decided later on Wednesday night.
Mr. Venizelos, a former finance minister who negotiated Greece’s second
debt deal with foreign creditors, said George Zannias, the outgoing
finance minister, would represent Greece at a European finance
ministers’ summit meeting on Thursday. It is expected that the president
of the National Bank of Greece, Vassilis Rapanos, will assume the
finance portfolio in the new cabinet.
Mr. Venizelos said he and the leaders of the other two parties in the
coalition would meet with Mr. Zannias Wednesday night for a briefing
ahead of the finance ministers’ meeting.
“We have to prepare very well for the European summit; it will be the
first battle to change the program and return to growth,” said Mr.
Venizelos, referring to Greece’s debt deal with creditors. He again
criticized Syriza, which came second in Sunday’s elections and opposes
the bailout, for not joining a “national negotiating team.”
Earlier on Wednesday, Mr. Samaras met with Mr. Kouvelis. In a televised
statement after the talks, Mr. Kouvelis confirmed his party’s support
for a New Democracy-led coalition. He said he expected an agreement on a
common policy platform within few hours and the composition of the new
government to be announced by Thursday at the latest.
Earlier in the day, Mr. Venizelos met with his party’s legislators to
discuss his proposals for the form that the Socialists’ participation in
a coalition should take. On Tuesday, he said former top-ranking
Socialist ministers and current legislators should not join the cabinet
to avoid being associated with any additional austerity measures,
comments that drew criticism from some party officials. Leaders of the
Democratic Left also hinted that they might seek to avoid responsibility
for decisions of the new government by limiting their participation in
the new cabinet.
Mr. Venizelos noted that many of the tough terms of the bailout that he
helped work out while serving as finance minister had been “imposed” on
Greece during the first phase of the negotiations, when the critical
goal was to seal a deal quickly to ensure that Athens did not run out of
money to pay its bills. He said the agreement was always seen as open
to revision.
The new government will face a daunting double mandate to enforce
Greece’s loan agreement with its foreign creditors — the European
Central Bank, the International Monetary Fund and the nations of the
European Union — while renegotiating enough of the bailout terms to keep
the government in power in the face of growing social unrest among the
rapidly unraveling middle class. It must also reassure investors enough
to slow the flight of deposits from Greek banks.
“Greek banks may be small,” said Carl Weinberg, the chief economist at
High Frequency Economics, a consulting firm in Valhalla, N.Y., “but if
the public doesn’t see that government authorities can ensure that the
banks are safe at all times, then the banking system won’t be stable.”
Greece’s official creditors had made it no secret that they wanted Mr.
Samaras to prevail over Syriza, with its calls to tear up the loan
agreement.
The creditors have indicated that they are willing to talk about changes
to the agreement, but it is unclear how far Europe’s leaders,
particularly Chancellor Angela Merkel of Germany, are prepared to go in
making concessions.
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