Greece clears final reform hurdle before new talks

Athens, Greece—Greece’s radical left-led government emerged bloodied but alive last Thursday from a key vote in parliament, which overwhelmingly approved new creditor-demanded reforms, despite a revolt among hardliners in the main coalition partner. 

The reforms to the judiciary and banking systems were the final hurdle the financially-battered country was obliged to clear before it can start talks with its creditors on a third bailout worth about 85 billion euros ($93 billion).

Without the money Greece would face financial ruin and a forced exit from the euro currency club.

Lawmakers voted 230-63 in favor of the measures, following a whirlwind debate that ended at 4 a.m. (0100 GMT). Another five members of the 300-seat house voted present, a kind of abstention.

Prime Minister Alexis Tsipras was unable to forestall a second revolt in a week among his own Syriza party lawmakers, but had no trouble passing the draft legislation with the backing of pro-European opposition parties.

Government spokeswoman Olga Gerovasili conceded that there is a clear rift within Syriza, but would not say whether rebels would be expelled.

“From this point on, party procedures will be followed in order to deal with the problem,” she said after the vote.

The number of disaffected Syriza lawmakers, who see the reforms as a betrayal of the anti-austerity platform that brought their party to power in January, shrunk slightly compared to last week’s similar vote—from 38 to 36. But that is still roughly a quarter of all party lawmakers.

Addressing parliament before the vote, Tsipras said the reforms were a necessary price to pay to keep Greece alive after stormy talks with its creditors nearly collapsed earlier this month.

“We have chosen a compromise that forces us to implement a program in which we do not believe, and we will implement it because the alternatives are tough,” he told lawmakers. “We are summoned today to legislate under a state of emergency.”

Tsipras also ruled out resigning.

“The presence of the left in this government isn’t about the pursuit of office, it’s a bastion from which to fight for our people’s interests,” he said. “And as far as I’m concerned, I won’t abandon this bastion, at least of my own free will.”

Tsipras said approval would give Greece breathing room to quash speculation that the country will be forced to abandon the euro, and help it regain market confidence and eventually tap bond markets again.

Before the debate got underway, about 10,000 people demonstrated outside parliament, protesting the latest measures to overhaul Greece’s judicial and banking sectors. Minor violence marred the end of the protest when a few teenagers threw gas bombs at riot police, but no injuries or arrests were reported.

Negotiations with creditors are now expected to start soon.

“From this point on, the government will focus all its attention on negotiating efforts in order that the agreement is concluded,” Gerovasili said. She also pledged action to tackle corruption and tax evasion, address the “humanitarian crisis” in a country where more than a quarter of the workforce is jobless and poverty has soared, and restart the recession-mauled economy.

The Syriza-led coalition government hopes the new bailout talks can conclude before August 20, when Greece must repay a debt worth more than 3 billion euros ($3.3 billion) to the European Central Bank. AP