Greece’s anti-austerity leftist party Syriza was on course to win yesterday’s snap election by a large margin over Prime Minister Antonis Samaras’s conservatives, a joint exit poll showed late yesterday.
During a victory speech Syriza party leader Tsipras pledged to take on international lenders and roll back painful austerity measures imposed during years of economic crisis.
Meanwhile as flag-waving supporters hit the streets of Athens, some shedding tears of joy, Germany’s Bundesbank warned Greece it needed to reform to tackle its economic problems and the euro fell nearly half a US cent.
A total of seven parties are set to enter Parliament, including the far-right Golden Dawn, but the final result will depend heavily on votes still to be counted in Athens, which accounts for slightly under half of Greece’s 11 million population.
Tsipras has promised to keep Greece in the euro and has toned down some of the fiery rhetoric for which he was known but his arrival in power would herald the biggest challenge to the approach so far adopted to the crisis by eurozone governments. Financial markets have been worried a Syriza victory will trigger a new financial crisis in Greece, but the repercussions for the eurozone are expected to be far smaller than feared the last time Greeks went to the polls in 2012.
Berlin insists the bailout deal must be respected
If Syriza ends up short of an absolute majority, Tsipras will have to try to form a coalition with smaller parties or reach an agreement that would allow Syriza to form a minority government with ad-hoc support from others in parliament.
Michalis Kariotoglou, an official from the pollsters that processed the results for the interior ministry, said the election had produced a “thriller”.
A number of parties could fit as potential partners, including the centrist To Potami or the anti-bailout Independent Greeks. However if it requires support to govern, it may find itself hostage to its partners’ demands, raising questions over how durable a Syriza government would prove.
Coming after the European Central Bank’s move to pump billions into the bloc’s flagging economy, yesterday’s result will stir consternation in Berlin, which insists the bailout deal must be respected.
Asked about the reminder of the need for reform from Bundesbank President Jens Weidmann, Syriza spokesman Panos Skourletis told Greek television: “It confirms the negotiations have already started.”
Tsipras has promised to renegotiate a deal with the European Commission, European Central Bank and International Monetary Fund “troika” and write off much of Greece’s €320 billion debt, which, at more than 175 per cent of gross domestic product, is the world’s second highest after Japan. He also wants to roll back many of the harsh austerity measures demanded by the ‘troika’, raising the minimum wage, lowering power prices for poor families, cutting property taxes and reversing pension and public sector pay cuts.