Greek government wins confidence vote, bigger battles loom
ATHENS (Reuters) - Greece's new conservative-led government won parliamentary approval on Monday, but faced the much tougher task of convincing European partners and the IMF to give it more time to meet the terms of its bailout.
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 privatizations and long-discussed structural reforms, saying those were the first steps to regaining credibility with lenders.
"We don't want to change the targets of the bailout but that which is causing recession and hampering us from attaining those goals," Prime Minister Antonis Samaras said in a speech before the confidence vote.
"We have been saying the same thing repeatedly all along - the only way to avoid bankruptcy and an exit from the euro is through growth and investments."
Finance Minister Yannis Stournaras says he has already been warned by visiting officials from the lenders that he will face a difficult time at a Monday meeting of the Eurogroup finance ministers. He has tried to lower Greek expectations of a swift overhaul of the harsh austerity terms included in the bailout.
Samaras's government - which stumbled off to a rocky start when both he and his initial pick for finance minister were laid low by medical problems - will have to juggle strident demands from home and abroad.
Faced with deep anger against wage and spending cuts in the 130-billion-euro bailout and an emboldened leftist opposition waiting in the sidelines, Samaras has promised long-suffering voters that the punishing terms of the rescue will be softened.
But with Greece facing bankruptcy within weeks without its next tranche of aid, the government has to sing a different tune abroad - promising the country will stick to its prescribed path of austerity in the hope of convincing lenders it deserves more time, money and flexibility.
Stournaras sought to reassure some of the concerns of the so-called troika of European Union, European Central Bank and International Monetary Fund lenders by pledging to jumpstart a stalled privatization plan and implement structural reforms.
Officials from the troika, who were wrapping up a visit to Athens on Sunday by meeting government officials, are unlikely to be impressed until they see proof of Greece's commitment to reform.
The senior troika officials are due to return towards the end of the month for more substantial discussions on Greece's faltering progress in hitting its targets, before deciding whether to disburse the next installment of aid.
Athens has acknowledged it is off-track in keeping up with its bailout pledges, which it blames largely on a deeper than expected recession and a two-month political limbo due to repeat elections in May and June.
Debt-laden Greece is now in its fifth year of recession, with nearly one out of four out of work. Samaras's victory in last month's election has eased - but failed to fully quell - concern the country is at risk of leaving the euro zone.
Samaras's conservatives have the support of the Socialists and a small leftist party, but face a formidable opponent in the radical leftist Syriza group that wants to tear up the bailout.
"The bailout is a political and economic crime imposed on the country by the troika," Syriza's charismatic leader Alexis Tsipras told parliament during Sunday's debate.
"You are not pro-Europeans, you are Merkelists - Berlin will lead Europe to dissolution," he told the government, referring to German chancellor Angela Merkel, who is deeply unpopular in Greece for demanding austerity cuts.
Samaras, in turn, spent much of his final remarks in parliament attacking Tsipras, accusing him of "terrorizing" potential investors in the country with his anti-bailout rhetoric and arguing that he was part of the "drachma lobby group".
(Writing by Deepa Babington; editing by Philippa Fletcher)