| Greek minister resigns over bailout stance |
ATHENS Greece’s deputy labour minister resigned on Monday saying the government was not being aggressive enough in pushing for changes to an unpopular bailout, becoming the third cabinet member to quit the fledgling coalition in as many weeks as the new conservative-led government won parliamentary approval early on Monday.
There had been little doubt the government would sail through the confidence vote after a heated three-day debate in which it pledged to win back the trust of foreign lenders.
All 179 ruling coalition deputies backed the motion in the 300-seat parliament.
After demanding a long list of changes to Greece’s latest rescue package when it took power last month, the three-party coalition has struck a more conciliatory tone in recent days as it faces the prospect of running out of cash without more aid.
It has pledged to push through privatisations and long-discussed structural reforms, saying those were the first steps to regaining credibility with lenders.
The resignation is a new setback for Prime Minister Antonis Samaras, whose government had already stumbled to a rocky start when his initial pick for finance minister stepped down over health problems.
“The sole reason for my resignation is my personal conviction that the issue of renegotiating with the troika, as well as the correction of significant distortions in labour, pension, social security and welfare issues, should have been emphatically put on the table from the start,” Nikos Nikolopoulos wrote in his resignation letter.
Analysts said the resignation was far from a fatal blow to the government but suggested internal rifts were emerging over the coalition’s stance on renegotiating the bailout with the three lenders - the European Union, the European Central Bank and the International Monetary Fund.
The government initially demanded numerous changes to the rescue package when it took power last month, but has struck a more conciliatory tone in recent days as it faces the prospect of running out of cash without more aid.
“It is an indication that the government will face internal problems between groups pushing for a ‘hard’ and ‘soft’ stance towards the troika and the terms of the bailout,” said Theodore Couloumbis, political analyst at Athens-based think-tank ELIAMEP.
The challenge facing the coalition was underscored when a think-tank on Monday projected the economy would contract a steeper-than-expected 6.9 per cent this year, a tumble that will further hamper efforts to cut the deficit and bring yet more pain to Greeks.
Such a decline would mean Greece’s economy has shrunk by a fifth since the end of 2007, according to the data from the influential IOBE think-tank, formerly run by the country’s new finance minister Yannis Stournaras.
He replaced banker Vassilis Rapanos who resigned as finance minister last month after being hospitalised days after he was named to the post. A deputy shipping minister also quit after it emerged he had run afoul of a law that prohibits cabinet members from owning offshore companies.
The government has tried in recent days to lower Greek expectations of a swift overhaul of the harsh austerity terms included in the bailout, and tried to focus on asset sales and reforms as the first step to regaining credibility with lenders.
Agencies
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