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 The repayment to the European Central Bank marked another step for
Greece away from near financial collapse, but Prime Minister Alexis
Tsipras must now tackle a political crisis after anti-bailout rebels
robbed his government of its parliamentary majority.
Athens repaid the debt using money from the first instalment of its
new bailout after the program cleared its final hurdle on Wednesday
night, with the ESM European bailout fund approving the 86 billion
euro ($96 billion) deal.
"The payment was made, the funds are on their way," the official
told Reuters.
Greece came close to the economic abyss and exit from the euro zone
in late June as Tsipras tried to extract concessions which the
bloc's finance ministers refused to grant.
Tsipras backed down last month, accepting terms that are so onerous
that the hard left wing of his Syriza party refused to back the
bailout in parliament last Friday, and is threatening to break away.
Energy Minister Panos Skourletis, a close Tsipras adviser, said the
split had to be dealt with. "The political landscape must clear up.
We need to know whether the government has or does not have a
majority," he told state TV channel ERT.
Tsipras got the bailout through parliament only with the support of
opposition parties, who said they did so merely to save the nation
from financial ruin.
The prime minister has talked about calling a Syriza congress to
resolve differences with the rebels. But, expressing his personal
opinion, Skourletis said Tsipras should move faster. "I would say
elections first, then the party congress," he said.
The government had to close the banks at the end of June for three
weeks as panicking savers pulled out billions, and imposed capital
controls strictly limiting withdrawals from the banking system.
While these have since been eased, they remain in force, hurting
businesses and raising the risk that unemployment will rise from its
current 25 percent.
Tsipras, who came to power only in January, has remained silent over
the election issue. But his ministers have openly debated the pros
and cons of an early election - which would be the third in as many
years - following the party split.
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TSIPRAS WEIGHS HIS OPTIONS
Tsipras is weighing at least two options. One is to call elections
in September before voters start feeling the new bailout measures
including further pension cuts, more value-added tax increases and a
"solidarity" tax on incomes.
Knock-on effects of the capital controls, which are likely to stay
until Greek banks are recapitalized later this year with bailout
funds, will also hurt voters.
The other option is to delay the vote till October, after
international creditors have reviewed Greece's performance in
keeping to the bailout program. They will then start to consider
some way of easing the country's huge debt burden.
Tsipras has long argued that Greece will never be able to repay all
its debts and wants some to be written off. While the euro zone
favors merely delaying interest and principal repayments, Tsipras
could still present any debt relief moves as an achievement to the
electorate.
A Metron Analysis poll on July 24 put support for Syriza at 33.6
percent, making it by far the most popular party, but not enough to
govern without a coalition partner, as it does now. No polls have
been published since then due to the holiday season.
Syriza members have argued that the party should aim for a majority,
saying this would achieve the stable government which Greece has
lacked through the past five years of crisis.
"These elections, whenever they are announced by the government,
will provide a stable governing solution. My feeling is that Syriza
will have an absolute majority," Dimitris Papadimoulis, a Syriza
lawmaker in the European parliament, told Mega TV.
(Reporting by George Georgiopoulos; writing by David Stamp; editing
by Giles Elgood)
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