Bailout talks hold key to new Greek cabinet's future

Greek efforts to renegotiate a disputed EU-IMF bailout deal will hold the key to the future of an unusual coalition government unveiled this week following landmark elections, analysts said. "If the government succeeds in revising the memorandum, it will have a chance of surviving," said Nikos Dimou, an author and political commentator in Athens. "If it does not, or if it only makes cosmetic changes to the memorandum, then the opposition is very strong and they will start strikes and protests. "They will make life very difficult for the coalition" -- an arrangement that is unusual for Greece where politics is usually more clear-cut, Dimou said. The coalition led by Antonis Samaras and his conservative New Democracy party said in its first statement on Thursday that it would renegotiate the multi-billion euro bailout without risking Greece's eurozone membership. It was an initial sign of the pressures the new government will face after the radical leftist anti-austerity Syriza party that ended up losing Sunday's elections still managed to garner more than a quarter of the vote. New Democracy failed to win an outright majority and has teamed up with the socialist Pasok party and the moderate Democratic Left party, which are not including their own lawmakers in the cabinet but will support it in parliament. As he crowned a political career by being sworn in as prime minister on Wednesday, Samaras promised that his would be "a long-term government of stability and hope" -- but some analysts said its longevity is in question. "In Greece, there is no culture of having coalition governments. I don't think it will be stable," said Manolis Alexakis, an assistant professor of political sociology at the University of Crete. Alexakis said the move by Pasok and Democratic Left not to be fully fledged members of the cabinet and to put forward technocrats instead was a tactical one to avoid responsibility for any more austerity measures. "The two minor parties want to wait and see what misfortune might befall the new government," he said, adding that meanwhile the Syriza party was waiting for its turn in power from the opposition side. "All Syriza have to do is wait. There is a space on the centre-left for them. It's only a matter of time before it comes to government," he said. Some analysts have been far more upbeat about the new government's chances. "The vote showed people favoured pro-European parties even though there is a price to pay. This will create a more stable government," said Paschos Mandravelis, a columnist for the liberal Kathimerini daily. "We've had trouble in the streets already. People are tired of it," he said. Mandravelis said that while the idea of a coalition was new for Greece, the sight of three political leaders acting together was "hopeful." Stavros Thomadakis, a professor of financial policy at the University of Athens, agreed saying: "The new coalition government is a very sincere and serious effort. We have a chance of making a real break with the past. "This government represents a large part of the political spectrum," he said. Analysts drew attention in particular to the appointment of Vassilis Rapanos, a top banker who helped Greece join the euro in 2001 and is seen as close to the Pasok party. He takes the crucial post of finance minister. "It's better to have people who know the problems instead of politicians who mess things up," Mandravelis said. Thomadakis agreed, saying Rapanos was "a realist who can restore the economic stability of the country." Analysts agreed that the Greek bailout talks were likely be helped by a new atmosphere in Europe in which full-blown austerity is considered part of the problem rather than a solution for getting debt-ridden economies back on track. "This more global solution which will include policy changes being proposed above all by France... will manage to guarantee the banking system" and boost growth which would benefit Greece, Thomadakis said. Alexakis said he too was hopeful regarding the bailout negotiations. "The Europeans are already talking about a time extension and some reconditioning of the terms. "I think there is definitely room for negotiation. The question is whether or not the Greek people will accept it."