The Star Online: World Updates
The Star Online: World Updates |
- Greek prime minister faces knife-edge survival vote
- Greek PM ready to go, dump referendum, for euro deal
- Palestinians won't accept less than full UN seat - FM
| Greek prime minister faces knife-edge survival vote Posted: ATHENS (Reuters) - Greek Prime Minister George Papandreou faces a knife-edge confidence vote on Friday after his plan for a referendum on a bailout -- supposed to save both Greece and the euro zone from disaster -- backfired disastrously.
But even if his socialist government survives the parliamentary vote, Papandreou's days as Greek leader looked numbered after a deal with his cabinet under which, government sources said, he agreed to stand down after negotiating a coalition with the conservative opposition. Much of Greece and many European leaders reacted with horror after Papandreou abruptly announced on Monday that he would put the 130-billion-euro ($180-billion) rescue plan, agreed at a euro zone summit only last week, to the Greek people. Papandreou came out fighting, rejecting opposition demands, in public at least, that he make way for a caretaker administration with just two tasks: forcing the bailout through parliament without a referendum and calling of snap elections. However, analysts said Papandreou may not be around much longer to fight such battles. "The prime minister's position is very difficult, since he chose not to respond to the opposition's proposal for a transitional coalition government. Therefore I believe that it is unlikely that he will win the vote," said head of ALCO pollsters, Costas Panagopoulos. Through waves of austerity policies demanded by the nation's international lenders, Papandreou has carried the parliamentary group of his PASOK party with him, despite much grumbling within the ranks. But a steady trickle of defections has reduced his majority to the point that one or two waverers could inflict a defeat in the confidence vote, expected as late as midnight (2200 GMT). PASOK has 152 deputies in the 300-member parliament. But lawmaker Eva Kaili said that while she would stay in the party, she would refuse to support the government in the confidence vote, meaning Papandreou could count at most on the support of 151 deputies. Only one more defection would strip the government of its majority and probably trigger early elections. TOOTH AND NAIL Greeks have fought tooth and nail against policies which have brought spending cuts, tax rises and job losses, pushing the nation into three years of recession, and they have staged a series of strikes and protests, some of which turned violent. This made a "no" vote in any referendum highly likely, even though this would cut off Greece's last international financial lifeline and risked spreading its debt crisis to much bigger euro zone economies, such as Italy and Spain. But after a tumultuous day in Greek politics, the chances of the referendum being held dwindled to almost nothing on Thursday. Papandreou offered to drop the idea anyway if the conservative opposition backed the bailout in parliament. Over the day, he talked about negotiating with the conservative New Democracy party, saying the national interest ranked well above his personal ambitions. "I'm not tied to my post. I'm not interested either in being re-elected, I'm only interested in saving the country," he told parliament. Papandreou also called on his PASOK party to rally behind him in the confidence vote. But his public bravado appeared to mask an acceptance that his term may come to an end soon. Government sources said Papandreou had struck a deal at a cabinet meeting on Thursday under which he would stand down after he had negotiated a coalition agreement with the conservative opposition -- provided he survives Friday's vote. Ministers involved in striking the deal with Papandreou, led by Finance Minister Evangelos Venizelos, said he should go for the sake of their PASOK party, said the sources, who had knowledge of Thursday's meeting of the cabinet. "He was told that he must leave calmly in order to save his party," one source told Reuters on condition of anonymity. "He agreed to step down. It was very civilised, with no acrimony." Papandreou admitted he had made a mistake in calling on Monday for the referendum on a bailout, the sources said. German Chancellor Angela Merkel and French President Nicolas Sarkozy summoned Papandreou and Venizelos to Cannes on Wednesday where they made clear Greece would receive no EU aid if the nation failed to stick to the deal. (Additional reporting by Reuters Athens bureau; Writing by David Stamp; Editing by Louise Ireland) Copyright © 2011 Reuters Full content generated by Get Full RSS. | ||
| Greek PM ready to go, dump referendum, for euro deal Posted: ATHENS/CANNES, France (Reuters) - Intense European pressure forced debt-stricken Greece to seek political consensus on a new bailout plan instead of holding a referendum after EU leaders raised the prospect of a Greek exit from the euro to preserve the single currency.
Fast-moving events in Athens overshadowed the first day of a summit of the Group of 20 major economies on the French Riviera on Thursday, with anxious world leaders urging Europe to act to stop contagion from its sovereign debt crisis. Greek Prime Minister George Papandreou bowed to cabinet rebels and agreed to step down and make way for a negotiated coalition government if his Socialists back him in a confidence vote on Friday, government sources told Reuters. "He was told that he must leave calmly in order to save his (PASOK) party," one source said on condition of anonymity. "He agreed to step down. It was very civilised, with no acrimony." Papandreou, son and grandson of left-wing prime ministers, hinted he was ready to quit for the sake of national unity, telling parliament he was not wedded to his job. G20 leaders meeting in Cannes discussed increasing the International Monetary Fund's resources and building a financial firewall to protect vulnerable euro zone economies Italy and Spain from a possible Greek default. Papandreou said his call this week for a referendum, which sparked panic on global financial markets and infuriated European partners, "was never a purpose in itself", and he would be happy if the vote were not held. Papandreou told PASOK lawmakers he had agreed to talks with the centre-right opposition on a transitional government to implement a new EU/IMF bailout programme agreed last week, and pave the way for early elections. At a bruising meeting in Cannes on Wednesday night, French President Nicolas Sarkozy and German Chancellor Angela Merkel warned him that Athens would not receive a cent more in aid until it met its commitments to the euro zone. Greece was due to get a vital 8 billion euro instalment this month and says it will run out of money in mid-December if it does not get the loan. Despite the turmoil in Athens and uncertainty over the euro zone, European stock markets and the euro rallied in volatile trading as the likelihood grew that Greece would not hold the highly risky referendum. The European Central Bank also provided a surprise boost by cutting interest rates by 25 points to 1.25 percent and saying its policy of buying euro zone government bonds would continue for now with limited scope to support its monetary policy. The leaders of China, Russia and the United States pressed the Europeans to move more swiftly to contain the debt crisis, with Washington urging Germany to relent and let the ECB play a greater role in financial firefighting, G20 sources said. "Europe should aid itself. The European Union has everything for that today -- the political authority, the financial resources and the backing of many countries," Russian President Dmitry Medvedev said. Canadian Prime Minister Stephen Harper said the leaders had discussed contingency plans if Greece were to leave the euro zone, "but my expectation is that cooler heads will prevail and the package will be accepted (by Greece)". ITALY NEXT Italy was next in the euro zone firing line, facing fierce pressure to make good on long delayed economic reforms. European G20 leaders along with U.S. President Barack Obama, IMF Managing Director Christine Lagarde and new ECB President Mario Draghi met on the sidelines to press Italian Prime Minister Silvio Berlusconi for a timetable for key labour market, pension and privatisation measures, EU sources said. Berlusconi failed to win agreement from his divided centre-right cabinet for the reforms just before flying to Cannes. A draft plan agreed with the G20 on Thursday includes a commitment by Italy to get its budget deficit "near balance" by 2013 and to rapidly reduce its debt-to-GDP ratio, sources told Reuters. That is less ambitious than Italy's promise only last month to balance its budget in 2013. EU leaders are concerned that if Italy cannot get its finances in order, the economy -- the eurozone's third largest -- could go the way of Greece, Ireland and Portugal in needing a bailout from the EU. GREECE REVOLT In Athens, Finance Minister Evangelos Venizelos led the revolt against Papandreou, saying Greece's euro membership was a historic achievement and "cannot depend on a referendum". Dissident PASOK lawmakers called for a temporary national unity government, which some suggested could be led by former ECB vice-president Lucas Papademos. Signalling for the first time a will to compromise, opposition leader Antonis Samaras called for a transitional government to lead Greece to early elections within weeks and said parliament should first ratify last week's 130 billion euro ($178 billion) bailout deal. European Union leaders have long called for national unity in support of painful austerity measures required to cut the country's crippling debt, expected to reach 160 percent of gross domestic product this year. Sarkozy told a news conference the tough message delivered by France and Germany to Greece's political class was starting to bear fruit. "Things are progressing," he said, welcoming Samaras' support for the bailout plan. Euro area leaders talked openly of a possible Greek exit from the 17-nation currency area, seeking to maximise pressure on Athens and preserve the euro in case of a "no" vote. Merkel repeated that the stability of the euro had priority for Germany over Greece's euro membership, touching a popular nerve at home. Germany's best selling Bild newspaper railed against Greece and demanded it be ejected from the euro. A telephone poll found 86 percent of Germans want Greece out of the currency. The chairman of euro zone finance ministers, Luxembourg Prime Minister Jean-Claude Juncker, said policymakers were working on possible scenarios for a Greek exit. The spectre of a possible hard Greek default and euro exit hung over the G20 summit, highlighting Europe's frailty and divisions just when Sarkozy had hoped to showcase his leadership of the world's major economies. The summit had been meant to focus on reforms of the global monetary system and steps to rein in speculative capital flows and regulate commodities markets, but the shockwaves from Greece upended the talks. Obama said Europe had taken some important steps towards a comprehensive solution to its debt crisis but now needed to flesh out and implement the plan quickly. A disorderly Greek default would reverberate across the euro zone, engulfing big economies like Italy and Spain, and potentially plunging the global economy into a recession. CREDIT LINES? Euro zone finance ministers are working to accelerate implementation of an anti-crisis package agreed on Oct. 27. That plan, which includes debt relief for Greece, a recapitalisation of European banks and a leveraging of the bloc's rescue fund, was meant to stem the two-year old crisis before Papandreou's referendum call cast the bloc into turmoil. Officials said the meeting focused on speeding up the creation of a firewall to protect other vulnerable euro zone states from the fallout from Greece. The risk premium on Italian bonds over safe-haven German Bunds has hit euro-lifetime highs this week, despite European Central Bank buying of its bonds. Spain had to pay its highest yield since 2008 at a bond auction on Thursday. The G20 is considering an IMF proposal to create a new short-term line of credit to help countries that are facing economic shocks beyond their control, a G20 official familiar with the talks said. British finance minister George Osborne said leaders discussed increasing the global lender's resources, which China strongly backed, and he had heard no dissenting voices. (Additional reporting by Lefteris Papadimas in Athens, David Ljungren, Abhijit Neogy, Giselda Vagnoni, Catherine Bremer, Gernot Heller, Daniel Flynn, Luke Baker, Gui Qing Koh and Alexei Anischuk in Cannes; Writing by Paul Taylor; Editing by Janet McBride) Copyright © 2011 Reuters Full content generated by Get Full RSS. | ||
| Palestinians won't accept less than full UN seat - FM Posted: RAMALLAH, West Bank (Reuters) - The Palestinians will not accept anything less than full U.N. membership and do not want an upgrade to an observer state in the world body, their foreign minister said on Thursday.
Riyad al-Malki's remarks suggested the Palestinians would not seek such an upgrade once their bid for full state membership meets its widely expected fate -- failure due to opposition from the United States and other governments. Malki told journalists in Ramallah the Palestinians could have won observer state status long ago and were not interested in it now. They currently hold the status of observer entity. "We do not want, after all of these struggles, sacrifices, and efforts by the entire Palestinian people, to accept an observer state in the United Nations. We will not accept less than we deserve: a full member state," he said. Analysts said if the Palestinian leadership does not seek enhanced status after failing to gain full membership it would mark a retreat. But they said Malki's remarks may not reflect the path President Mahmoud Abbas may take. "This reads like a tactical move," said George Giacaman, a political analyst. "It could be directed towards the Americans, the Israelis, to show flexibility, but I would not view it as a final position." The Palestinian bid for statehood recognition in the U.N. system has drawn fierce criticism and sanctions from the United States and from Israel, which in 1967 captured territory the Palestinians now seek for an independent country. The U.S. Congress has frozen some $200 million in economic aid to the Palestinian Authority over its statehood quest. Israel this week froze duties it collects on behalf of the Palestinian Authority in response to its admission to the U.N. cultural agency UNESCO. But one U.S. lawmaker who had held up an additional $150 million in security aid for the Palestinians, Representative Ileana Ros-Lehtinen, lifted her hold on the money, a spokesman said on Thursday. Ros-Lehtinen remains a sharp critic of the Palestinian push for statehood status at the U.N. But she agreed to unlock the money for training Palestinian security forces after the State Department sent her 1,000 pages of information she requested about the uses and purposes of the aid, her spokesman said. Malki said for now the Palestinians would not seek to join more U.N. agencies as a full member. "At this moment, we are not concerned with applying for membership for Palestine in the rest of the international organizations," he said. UNESCO's vote in favor of Palestinian membership triggered an automatic cutoff in U.S. funding to the agency under U.S. law. The idea of the Palestinians joining more international agencies had raised the prospect of bodies such as the World Health Organization also losing their U.S. funding. "The official Palestinian position is to concentrate only on the request for membership which we presented to the United Nations," Malki said. VETO PLEDGE Abbas applied for full U.N. membership for the state of Palestine on Sept. 23. The request is now being considered by the Security Council, but the United States has already pledged veto it in the 15-nation body if it is brought to a vote. The Palestinians would score a moral victory and force Washington to cast its veto if they can muster nine votes to support them in the council. A council resolution needs nine votes in favor and no vetoes to pass. Many U.N. diplomats believe the Palestinians would get only eight votes, and a meeting of council ambassadors on Thursday to review the issue produced no surprises, envoys said. They said Russia, China, Brazil, India, Lebanon and South Africa supported the Palestinian bid, the United States opposed it, and Britain, France and Colombia said they would abstain if there were a vote. Gabon and Nigeria, expected to support the Palestinians, and Germany and Portugal, expected to abstain, did not spell out their positions and Bosnia did not speak. Bosnia is also thought likely to abstain because its Muslim, Serb and Croat collective presidency cannot agree. Palestinian U.N. representative Riyad Mansour told reporters nations were still deciding positions. He declined to say whether the Palestinians would push for a vote. The Palestinians will have to make that decision after the council concludes its review of the application next week with a report expected to say it cannot reach consensus. Both the United States and Israel say the Palestinian push in the United Nations is unilateral and an attempt to bypass peace talks, whose resumption Abbas has conditioned on an Israeli freeze of settlement activity in occupied territory. The Palestinians say those negotiations have failed to bring them closer to the independent state they seek in the West Bank, East Jerusalem and the Gaza Strip. They say it is time to try a different approach. The last round of peace talks collapsed last year. An upgrade to "non-member state" -- an idea also favored by French President Nicolas Sarkozy -- could be won through a resolution in the General Assembly, where the Palestinians would likely glean the support that got them into UNESCO. They would then enjoy status equal to the Vatican and secure the all-important title of a state. Addressing what would happen if they fail in their bid for full U.N. membership, Malki said: "We will repeat this experiment a second time, a third time and a fourth time until we reach that membership." (Additional reporting by Susan Cornwell in Washington and Patrick Worsnip at the United Nations; Editing by Sophie Hares) Copyright © 2011 Reuters Full content generated by Get Full RSS. |
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