Prime Minister Antonis Samaras, who presided over Greece’s return to capital markets, faces a test of his ruling coalition’s stability in European and local elections this weekend amid a challenge from bailout opponents.
With more than half of Greece’s youth still out of work, the SYRIZA opposition party led by Alexis Tsipras is the front- runner in voting for European Union lawmakers ending Sunday. SYRIZA rejects the fiscal-austerity terms that came with Greece’s bailouts after the country’s finances set off the euro- area debt crisis in 2010.
At the same time, support for Samaras’s PASOK coalition partner has slumped, increasing the fragility of his government’s majority of 152 lawmakers in the 300-seat parliament in Athens.
SYRIZA “could make significant gains,” Andrew Benito, an economist at Goldman Sachs International in London, said in a client note on May 21. That could create Europe-wide ripples “by complicating Greece’s national politics should the mandate of the existing coalition be questioned.”
Samaras, who took office in June 2012, said on May 20 that Greeks must choose between moving “forward to growth or backward to the crisis.”
As voters choose national representatives to the European Parliament, the premier and his New Democracy party are coming off the Greek state’s first bond auction in four years on April 11. The economy will end six years of recession and return to growth this year, according to the government and the EU. Fitch Ratings raised Greece’s credit rating one level today to B, five levels below investment grade.
Even so, SYRIZA leads New Democracy in polls for the EU elections. SYRIZA had as much as 30 percent support and New Democracy as little as 22.5 percent in three polls published since yesterday.
Elia, an alliance led by PASOK, the socialist party of former Prime Minister George Papandreou and Samaras’s junior coalition partner, polled 7 percent, while anti-immigrant Golden Dawn party got 8.5 percent, placing third. Samaras’s majority in parliament depends on PASOK’s 27 lawmakers.
“The European elections are a referendum for liberation” and the ballot is a choice between “bailouts and SYRIZA,” Tsipras said this week in the western city of Patras.
SYRIZA will probably win the most votes in the EU ballot, George Pagoulatos, a professor of European politics at the Athens University of Economics, said by phone.
Rather than spurring discord within PASOK, where party head Evangelos Venizelos is facing challenges to his leadership, a poor showing would force the party to “stick together” to avoid “political suicide,” Pagoulatos said.
New Democracy won 29.7 percent in Greece’s June 2012 election, compared with 26.9 percent for SYRIZA. The next national parliamentary election isn’t due until 2016.
Greeks are also voting on May 25 in the second round of local and regional elections. Candidates backed by Samaras’s party are ahead in eight of 12 administrative regions still being contested after the first round a week earlier.
New Democracy candidates failed to make the second-round cut in Athens and the wider metropolitan region of Attica, home to a combined 3.8 million people. SYRIZA reached the second round in four regions and leads in Attica, where more than half of Greece’s economic output is produced. [Bloomberg]