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Greece eurozone bailout: Coalition hit by defections | |
(40 minutes later) | |
Greece's coalition has been hit by the resignations of four senior politicians over the latest planned spending cuts. | |
The deputy foreign minister and three ministers from the far-right Laos party quit, amid protests and a 48-hour strike over the austerity proposals. | |
Greek leaders have been frantically trying to agree swingeing cuts demanded by the EU and IMF in return for a new 130bn-euro ($170bn; £110bn) bailout. | Greek leaders have been frantically trying to agree swingeing cuts demanded by the EU and IMF in return for a new 130bn-euro ($170bn; £110bn) bailout. |
The deal is still expected to pass a parliamentary vote set for Sunday. | |
The Laos party complained that Greeks were being humiliated by Germany, and announced its 15 deputies would not back the austerity measures. | |
'Final choice' | |
Deputy Foreign Minister Mariliza Xenogiannakopoulou, who quit on Friday afternoon, is the most senior defection so far. | |
And so it wasn't enough. Days of political horse trading to agree on a package of cuts and still Brussels has said "do more". The frustration here in Athens is palpable. | And so it wasn't enough. Days of political horse trading to agree on a package of cuts and still Brussels has said "do more". The frustration here in Athens is palpable. |
Parliamentary approval should be the least of the problems. The coalition controls a large majority of MPs so even a backbench rebellion shouldn't sink the package. The 325m euros in extra savings are possibly feasible too - there is talk that defence could be further cut. | Parliamentary approval should be the least of the problems. The coalition controls a large majority of MPs so even a backbench rebellion shouldn't sink the package. The 325m euros in extra savings are possibly feasible too - there is talk that defence could be further cut. |
But written commitment to the cuts from the party leaders could be the sticking point. It's a tactic that Brussels has tried before and it faced stiff resistance from politicians who talk of national humiliation. | But written commitment to the cuts from the party leaders could be the sticking point. It's a tactic that Brussels has tried before and it faced stiff resistance from politicians who talk of national humiliation. |
But the price of failure is too high for Greece's government, which fears bankruptcy and a potential exit from the euro. And eurozone leaders are unlikely to cut Greece loose either. Germany's Angela Merkel has said "if the euro fails, Europe fails." | But the price of failure is too high for Greece's government, which fears bankruptcy and a potential exit from the euro. And eurozone leaders are unlikely to cut Greece loose either. Germany's Angela Merkel has said "if the euro fails, Europe fails." |
Her Pasok party, the largest in the coalition, also suffered the loss of a deputy labour minister on Thursday. | |
But analysts say the cuts package should still have enough support in parliament because Pasok and its other coalition ally New Democracy account for more than 230 deputies out of a total of 300. | |
Earlier, an estimated 17,000 union members and communists took to the streets of Athens, marching to mark the start of a two-day general strike. | |
Protesters also gathered near the parliament building. | |
Some demonstrators threw stones and petrol bombs at police, who responded by firing tear gas. A small number of people from both sides suffered minor injuries. | |
Finance Minister Evangelos Venizelos said it was time for Greece to make a "final strategic choice". | Finance Minister Evangelos Venizelos said it was time for Greece to make a "final strategic choice". |
"If we see the future of our country within eurozone, within Europe, we should do what we have to do for the programme to be approved," he said. | "If we see the future of our country within eurozone, within Europe, we should do what we have to do for the programme to be approved," he said. |
Last night the Greeks presented their plans for austerity cuts to a meeting of eurozone ministers in Brussels. | Last night the Greeks presented their plans for austerity cuts to a meeting of eurozone ministers in Brussels. |
Their proposals include: | Their proposals include: |
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But the ministers demanded a further 325m euros in savings for this year. It is thought that the shortfall came because the Greek coalition could not agree to restructuring pensions. | But the ministers demanded a further 325m euros in savings for this year. It is thought that the shortfall came because the Greek coalition could not agree to restructuring pensions. |
The eurozone and IMF are also insisting that Greek leaders give "strong political assurances" on the implementation of the packages. | The eurozone and IMF are also insisting that Greek leaders give "strong political assurances" on the implementation of the packages. |
The ministers said the conditions must be fulfilled by next Wednesday, in time for another eurozone meeting to consider releasing the bailout funds. | The ministers said the conditions must be fulfilled by next Wednesday, in time for another eurozone meeting to consider releasing the bailout funds. |
The BBC's Mark Lowen in Athens says Greek politicians are frustrated that their planned cuts did not meet the demands of the eurozone and IMF. | The BBC's Mark Lowen in Athens says Greek politicians are frustrated that their planned cuts did not meet the demands of the eurozone and IMF. |
But the government is likely to plough on, he says, because the prospect of bankruptcy and a potential exit from the eurozone strikes fear into the hearts of its leaders. | But the government is likely to plough on, he says, because the prospect of bankruptcy and a potential exit from the eurozone strikes fear into the hearts of its leaders. |
Greece cannot service its huge debt, and there are fears that a default could endanger Europe's financial stability and even lead to a break-up of the eurozone. | Greece cannot service its huge debt, and there are fears that a default could endanger Europe's financial stability and even lead to a break-up of the eurozone. |
The country is already reeling from the effects of an earlier round of austerity that followed a previous bailout. Those cuts triggered widespread unrest and violent protests. | The country is already reeling from the effects of an earlier round of austerity that followed a previous bailout. Those cuts triggered widespread unrest and violent protests. |
The country is deep in recession, with unemployment rising above 20%. | The country is deep in recession, with unemployment rising above 20%. |