Greece moved closer on Tuesday to early elections that could undermine its international bailout and rekindle a eurozone crisis after lawmakers failed for a second time to elect a president.
The government candidate, EU Environment Commissioner Stavros Dimas, fell 32 votes short of the required 200 votes, meaning a third and final vote will be held on December 29.
Prime Minister Antonis Samaras warned after the vote that early general elections, which could be held as soon as January 25, constituted a "national danger" that must be avoided.
"Every lawmaker stands before their responsibility...as regards the consequences of their vote on stability, normality and the future of the homeland," Samaras told reporters.
European Union and International Monetary Fund officials fear an early election would be won by radical leftist party Syriza and could undo many of Greece's ongoing fiscal reforms.
Financial analysts said given Tuesday's showing, the government would be ultimately unable to turn the contest to its advantage.
"It appears that the ruling coalition has definitively lost," Natixis analyst Jesus Castillo said.
"Greece is very likely (facing) early legislative elections...a very uncertain political climate should thus create a high degree of volatility in the coming weeks," he said.
Greece's dire finances nearly destroyed the euro in 2012, and despite two bailouts worth 240 billion euros ($290 billion) and most of the debt held by private investors being wiped out, the economy has only begun to recover after six years of contracting.
The reforms required by the EU and IMF have improved the government's finances, but have taken a terrible toll on Greeks as unemployment soared above 27 percent and many people have had wages and benefits cut.
Syriza leader Alexis Tsipras -- who has pledged to raise wages and pensions and stall privatisations -- insisted that the country is heading for early elections which his party would win.
"With the new year, our country will turn the page," Tsipras told reporters.
However, an analyst at Hamburg-based Berenberg bank argued that Syriza would find governing Greece a mixed blessing once talks with the creditors began.
"Simply giving in to an anti-reform government proclaiming to 'call Europe's bluff' would not be the precedent Europe would contemplate," Holger Schmieding told AFP in an email.
- 'Potent risk' for Greece -
And he added that a Greek crisis had once again become a "potent risk", but mostly for Greece itself.
"The eurozone now has a well-oiled machinery to deal with crises," Schmieding said.
The Greek stock exchange lost over 2.0 percent at the time of the vote and later settled to a loss of 1.69 percent.
A total of 180 lawmakers are required in the third and final vote at midday on December 29.
In a bid to sway independent MPs, Samaras on Sunday offered to hold early elections in late 2015, provided that a president is elected and that tough talks with the country's EU-IMF creditors are concluded first.
In the first vote on December 17, the government candidate had picked up 160 votes.
After Samaras' offer, Dimas won another eight lawmakers to his side on Tuesday, including two former lawmakers of neo-Nazi party Golden Dawn.
The presidential vote has been tainted by allegations from a small nationalist party that people close to the government were trying to bribe its lawmakers into voting for Dimas.
However, an investigation by judicial authorities has so far found insufficient proof to press charges.
Greece recently secured a two-month extension from its international creditors to conclude an ongoing fiscal audit that will determine the release of some 7.0 billion euros ($8.7 billion) in loans.
This extension expires in February, and the finance ministry has warned that the state will face cash difficulties from March onwards.
In 2012, back-to-back elections were needed in May and June to form a shaky coalition government, stalling Greece's fiscal reforms and sparking speculation that the country was about to be ejected from the eurozone.
Greece moved closer on Tuesday to early elections that could undermine its international bailout and rekindle a eurozone crisis after lawmakers failed for a second time to elect a president.
The government candidate, EU Environment Commissioner Stavros Dimas, fell 32 votes short of the required 200 votes, meaning a third and final vote will be held on December 29.
Prime Minister Antonis Samaras warned after the vote that early general elections, which could be held as soon as January 25, constituted a “national danger” that must be avoided.
“Every lawmaker stands before their responsibility…as regards the consequences of their vote on stability, normality and the future of the homeland,” Samaras told reporters.
European Union and International Monetary Fund officials fear an early election would be won by radical leftist party Syriza and could undo many of Greece’s ongoing fiscal reforms.
Financial analysts said given Tuesday’s showing, the government would be ultimately unable to turn the contest to its advantage.
“It appears that the ruling coalition has definitively lost,” Natixis analyst Jesus Castillo said.
“Greece is very likely (facing) early legislative elections…a very uncertain political climate should thus create a high degree of volatility in the coming weeks,” he said.
Greece’s dire finances nearly destroyed the euro in 2012, and despite two bailouts worth 240 billion euros ($290 billion) and most of the debt held by private investors being wiped out, the economy has only begun to recover after six years of contracting.
The reforms required by the EU and IMF have improved the government’s finances, but have taken a terrible toll on Greeks as unemployment soared above 27 percent and many people have had wages and benefits cut.
Syriza leader Alexis Tsipras — who has pledged to raise wages and pensions and stall privatisations — insisted that the country is heading for early elections which his party would win.
“With the new year, our country will turn the page,” Tsipras told reporters.
However, an analyst at Hamburg-based Berenberg bank argued that Syriza would find governing Greece a mixed blessing once talks with the creditors began.
“Simply giving in to an anti-reform government proclaiming to ‘call Europe’s bluff’ would not be the precedent Europe would contemplate,” Holger Schmieding told AFP in an email.
– ‘Potent risk’ for Greece –
And he added that a Greek crisis had once again become a “potent risk”, but mostly for Greece itself.
“The eurozone now has a well-oiled machinery to deal with crises,” Schmieding said.
The Greek stock exchange lost over 2.0 percent at the time of the vote and later settled to a loss of 1.69 percent.
A total of 180 lawmakers are required in the third and final vote at midday on December 29.
In a bid to sway independent MPs, Samaras on Sunday offered to hold early elections in late 2015, provided that a president is elected and that tough talks with the country’s EU-IMF creditors are concluded first.
In the first vote on December 17, the government candidate had picked up 160 votes.
After Samaras’ offer, Dimas won another eight lawmakers to his side on Tuesday, including two former lawmakers of neo-Nazi party Golden Dawn.
The presidential vote has been tainted by allegations from a small nationalist party that people close to the government were trying to bribe its lawmakers into voting for Dimas.
However, an investigation by judicial authorities has so far found insufficient proof to press charges.
Greece recently secured a two-month extension from its international creditors to conclude an ongoing fiscal audit that will determine the release of some 7.0 billion euros ($8.7 billion) in loans.
This extension expires in February, and the finance ministry has warned that the state will face cash difficulties from March onwards.
In 2012, back-to-back elections were needed in May and June to form a shaky coalition government, stalling Greece’s fiscal reforms and sparking speculation that the country was about to be ejected from the eurozone.
