Greece Seems to Be Increasingly Heading Towards Early Elections

Southeast Europe | August 20, 2015, Thursday // 11:35|  views

Greek Prime Minister Alexis Tsipras adresses at the parliament, in Athens, Greece, 14 August 2015. Photo: EPA

Greece seems to be increasingly heading towards the holding of early elections after the government of Prime Minister Alexis Tsipras has lost vital support from his party in parliament.

The dissent within the main ruling party SYRIZA started to appear after Tsipras committed Greece to implementing certain reforms in exchange for being granted a third bailout by its international creditors.

The Greek prime minister first considered the option of holding a vote of confidence in parliament, but according to media reports he has changed his mind and is now thinking of early elections.

The only thing left to decide is their exact date, with some advisers advocating elections on September 20 or 27, while others are recommending that polls should not be held before October.

It is expected that the holding of elections in September will be beneficial in overcoming the internal split within SYRIZA.

However it is feared that this will send a signal to the country's international creditors that Greece does not have willingness to implement the reforms.

Therefore, another group advises Tsipras that he should not consider the holding of elections earlier than October 11.

This will provide time for Greece to implement some of the reforms, build trust with its creditors and possibly clear the first review of the adjustment programme.

The board of governors of the European Stability Mechanism (ESM) approved on Wednesday a three-year programme of up to EUR 86 B for Greece.

The first tranche is due to be disbursed on Thursday, when Greece is expected to receive a total of EUR 23 B.

Out of these funds, EUR 13 B will go for repaying a bridge loan of EUR 7.2 B, a EUR 3.2 B payment on a maturing government bond to the European Central Bank (ECB) and debt obligations to the International Monetary Fund (IMF).

Another EUR 10 B will be allocated for the recapitalisation of banks and will be held at a segregated account in the form of ESM notes.

According to government sources, following the first disbursement, Greece made the repayment to ECB on Thursday, daily Kathimerini informs.

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Tags: greece, bailout, debt, early elections, reforms, creditors, ECB, IMF, Alexis Tsipras, Syriza, ESM, banks, bridge loan


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