Wednesday 21 March 2018

Greek party set to quit coalition

A prime minister's office staff member closes the entrance during a cabinet meeting in Athens (AP/Petros Giannakouris)
A prime minister's office staff member closes the entrance during a cabinet meeting in Athens (AP/Petros Giannakouris)
Leader of the Democratic Left party Fotis Kouvelis arrives for a meeting with his party's MPs before deciding to quit the coalition (AP)

Greece's fragile coalition government was left reeling after a junior party decided to pull its two cabinet ministers from the cabinet following a dispute over state broadcaster ERT.

Democratic Left party officials said the ministers of justice and civil service reform would resign from the 17-member cabinet of ministers within the day. Two of the party's deputy ministers were also preparing to resign, the officials said.

It was not immediately clear whether the party would continue to support conservative Prime Minister Antonis Samaras' coalition government in parliament. A party statement said it would continue to pursue an "agenda of reform" - implying that it would extend limited support to the government.

Mr Samaras' three-party coalition currently has 167 seats in the 300-member parliament, including the 14 MPs from the Democratic Left. The government would be left with a slim working majority of just three if the Democratic Left withdrew its support. Socialist coalition party Pasok says it will remain in the Samaras government.

Civil Service Reform Minister Antonis Manitakis announced the news of the Democratic Left's cabinet withdrawal following a four-hour emergency meeting. The crisis in Greece saw the country's borrowing costs spike on Friday, while shares on the Athens Stock Exchange were 3.2% lower.

The interest yield on the country's benchmark 10-year bond - an indicator of investor confidence in a country - spiked 0.80 percentage point to 11.35% - the highest in 2013. Meanwhile, shares on the Athens Stock Exchange were down nearly 3% at midday.

Mr Samaras' coalition parties failed to resolve the dispute over broadcaster ERT following three meetings this week after the high court ruled the decision to close it unlawful.

Greece has been relying on 240 billion euros (£205 billion) in bailout loans from the other euro countries and the International Monetary Fund for the past three years. The country has had to introduce harsh austerity measures demanded by rescue creditors, which have deepened the country's recession.

Mr Samaras ordered ERT's closure on June 11, shutting off its signal and firing nearly 2,700 employees as the country embarks on a second stage of painful cuts likely to focus on reducing the size of the public sector.

Debt inspectors have suspended a review of Greece's public finances amid the political crisis, while the IMF has warned that loan payouts could be affected if that review does not restart soon. If Greece falls further into political crisis, it could miss some of its agreed bailout targets, which could force the creditors to withhold paying out the next tranche of loans.

Press Association

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