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Greeks await key austerity vote

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Greek police clashed with protesters trying to block the way into parliament on Wednesday as signs grew that the government would succeed in passing a sweeping austerity plan demanded by international creditors.

With Greece risking bankruptcy if the measures are blocked, parliament was expected to vote in the afternoon on the mix of spending cuts, tax increases and privatizations to be implemented as conditions for a massive bailout by the European Union and the International Monetary Fund.

After the start of a 48-hour general strike and violent clashes on Tuesday that transformed the central Syntagma Square into a battle zone, fresh protests were planned on Wednesday and thousands had gathered in front of parliament by midday.

Late on Tuesday, the government of Prime Minister George Papandreou received a boost when one of three rebel deputies from his PASOK party backtracked on his previous opposition and said he would vote for the package.

“I have made the decision to vote for the plan because national interests are more important than our own dignity,” the deputy, Thomas Robopoulos, told Reuters.

One communist deputy was pelted with yoghurt as she made her way into parliament and three people were treated for minor injuries as protesters clashed with police during an attempt to bar the way into the chamber.

The communist-affiliated PAME labour group held a rally in the morning and several other meetings were expected during the day, culminating in a major demonstration by public service union ADEDY and private sector union GSEE.

Greece’s central bank governor, George Provopoulos, warned that a “no” vote would be catastrophic for Greece.

“For parliament to vote against this package would be a crime - the country would be voting for its suicide,” he told the Financial Times.

The measures demanded by international lenders as the price for continuing to support Athens have caused bitter resentment among Greeks coping with the deepest recession since the 1970s and now facing years of grim austerity.

Another PASOK rebel, Panagiotis Kouroublis, said he still objected to the plan but declined to say whether he would vote against it. “I will speak to the Parliament later and you will hear what I have to say,” he told Alter TV. “Nothing is more important than my dignity and my love for my country.”

Papandreou’s Socialists hold a narrow majority with 155 seats in the 300-member legislature and with Robopoulos, the most prominent of a handful of potential rebels, backtracking on his opposition, chances of the vote going through improved.

In a sign of growing optimism on financial markets about the outcome, Greek bank stocks opened up 3 percent on Wednesday, while Greek bond yields fell.

However even with approval on Wednesday, there will still be a risk of lawmakers rejecting detailed austerity bills in votes on Thursday on the implementation of different elements of the plan, such as tax rises and the sale of state assets.

The EU and the IMF have said the entire plan must be passed this week for Greece to obtain the next, €12-billion tranche of emergency loans under the bailout.

Greek officials have said the country needs the money by mid-July to continue paying its debts.

Despite heavy international pressure, the centre-right opposition declared it would vote against the package but close attention was being paid to a splinter group of conservative deputies led by former foreign minister Dora Bakoyanis.

Bakoyanis, who broke party ranks to vote in favour of Greece’s first EU/IMF bailout last year, said on Wednesday she would abstain from voting this time. The other four deputies in her group would vote according to their consciences.

“The government cannot govern and apply the program and the political opposition is lying, this is the problem. It does not dare to tell people that there are no magic solutions, that sacrifices are necessary,” Bakoyanis said.

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