Greek finance minister Venizelos set to be Socialist leader

Reuters News
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Posted: Mar 11, 2012 2:13 PM
Greek finance minister Venizelos set to be Socialist leader

By Harry Papachristou

ATHENS (Reuters) - Greek Finance Minister Evangelos Venizelos will run unopposed for the leadership of the Socialists, party officials said on Sunday, as the political focus shifts towards a parliamentary election now that Athens has secured a bond swap deal.

Venizelos, 55, won the backing of all the Socialist PASOK party's heavy hitters and looks a certainty to become leader in an internal ballot on March 18.

However, winning the parliamentary election, penciled in for late April or early May, will be far tougher with all opinion polls showing PASOK badly trailing the conservative New Democracy party.

"Our country is at a crucial juncture and as a result a very large number of PASOK officials have supported my candidacy," Venizelos told a party conference at which his only potential rival, former minister and EU commissioner, Christos Papoutsis, dropped out after failing to secure sufficient backing.

A pensioner on crutches hurled yoghurt at Venizelos during the conference in a reminder of the unpopularity of austerity measures he has overseen in 9 months as finance minister.

Greek media are speculating that Venizelos will soon quit as finance minister to focus on the leadership. The constitutional-expert-turned politician, who is known for his public speaking and sharp intellect, has refused to comment on the reports.

Greece averted an uncontrolled default on Thursday, when it struck a debt exchange deal with private creditors that paves the way for a 130-billion euro bailout by the European Union and the International Monetary Fund later this month.

Venizelos, who was in charge of Greece's preparation for the 2004 Athens Olympics, was the key negotiator in those debt talks.

Completion of the second EU/IMF-led rescue in two years will set in motion the end of the technocratic coalition government under Prime Minister Lucas Papademos, which was formed in November with a mandate to conclude the bailout and then hold elections.

Both PASOK and the New Democracy back Papademos and the austerity measures he took to obtain the bailout. That has cost them dearly in the run-up to election, which is unlikely to produce an outright winner as small, left-wing, anti-austerity parties gain at their expense.

CONSERVATIVES TO GO IT ALONE

Conservative leader Antonis Samaras, 60, reiterated on Sunday he was seeking an absolute majority.

"The country can't be governed without one," he told a party conference. "I wouldn't have negotiating power abroad".

However most polls show that while New Democracy is firmly in the lead, it is well short of the support needed to rule alone and analysts expect it to form a coalition with PASOK once again.

Elections will be held at some point after April 29, government spokesman Pantelis Kapsis said late on Friday. Samaras said on Sunday that they will be held "after Easter", which in Greece falls on April 15.

Regardless of who wins the poll, German Finance Minister Wolfgang Schaeuble warned Greece that it would have to keep its promises.

"Greece must stick to its obligations after the election. That's the basis for the (bailout) programme," he said in an interview with Greek newspaper To Vima, published on Saturday.

Austerity measures tied to the country's first EU/IMF bailout in 2010 have plunged the Greek economy into its longest and deepest slump since World War Two. There is no sign of a return to growth that could help cut, or even maintain, its crippling debt pile.

Underlining the dire state of an economy where unemployment runs at 21 percent and more than half of the youth are out of work, data on Friday showed gross domestic product shrank by a record 7 percent in 2011. Investment slumped by 21 percent in 2011 after a 15 percent slide in 2010.

(Reporting by Harry Papachristou; Editing by Ben Harding)