ATHENS — Greece’s parliament approved a second batch of reforms on Thursday, which are needed to help unlock a huge international bailout for the stricken economy.
The bill passed by a resounding 230 votes out of the 298 members of parliament present, after a marathon debate that stretched into the early hours and exposed deep divisions in the governing Syriza party.
The legislation covers changes to the civil justice system, a bank deposit protection scheme and measures to shore up the liquidity of Greece’s banks — reforms that had to pass if Athens was to move forward in bailout negotiations with its creditors.
While the new law will come as a relief to prime minister Alexis Tsipras — who is negotiating a new bailout worth up to 86 billion euros ($94.58 billion) over three years — it saw him suffer a major rebellion amongst MPs in his leftist Syriza party for the second time in a week.
Thursday’s vote was seen as a key test of Tsipras’ authority after he was forced to reshuffle his cabinet following a mutiny by nearly a fifth of his MPs in a separate vote on the first tranche of tough economic reforms demanded by Athens’ creditors.
While the prime minister trimmed the rebellion from 39 ‘no’ votes and abstentions last week to 36 on Thursday, he was in both cases forced to rely on opposition parties to get the legislation passed.
Government spokeswoman Olga Gerovassili admitted the government was facing a “political problem” and said “planned procedures” would be implemented to address it. “The divide in the parliamentary majority is clear,” she told reporters after the vote.
European shares rose at the start of trading on Thursday on the news, with London’s FTSE adding 0.65%, and Frankfurt’s DAX 30 and Paris’s CAC 40 advancing 0.79%.
‘The Painful Path Does Not Stop Here’
While Tsipras is riding high in the opinion polls personally, analysts believe the deep divisions within Syriza are likely to force the government to call early elections after being voted into power at the beginning of the year.
The tough reform package sparked five hours of fiery debate on Wednesday night, with weary lawmakers clashing on everything from Marxism to submarines as dawn neared, and the speaker of parliament comparing the bailout deal to “a coup.”
In a passionate speech to the chamber, Tsipras insisted the deal was the result of a “difficult compromise” with Greece’s paymasters — the European Union, the European Central Bank and the International Monetary Fund — necessary to prevent Greece from tumbling out of the eurozone.
The youthful premier, who blazed to power in January promising to end austerity, warned that Greece had to adapt to “the new realities” of the bailout agreement.
“The painful path does not stop here, unfortunately,” he said. “We have been forced to make a difficult compromise under urgent conditions. We were at the limits of our economy and our banking system, and at the limits of Europe — where conservative forces, obsessed with austerity, dominate.”
Some 6,000 anti-austerity demonstrators had protested near parliament ahead of Wednesday night’s debate, lobbing a handful of petrol bombs in the direction of the police, who had thrown up a ring of steel around the building after riots during last week’s vote on austerity measures.
Katerina and George Sergidou Kokkinavis, two Syriza members in their 30s taking part in the protest, said they had come because “the government is no longer listening to the people.”
‘We Will Not Be Cowards’
Ahead of the vote, Vassiliki Georgiadis, a political science professor at Athens’ Panteion University, said it would be “difficult” for Tsipras’s Syriza-led coalition to remain in power if he is forced to rely on opposition MPs to get laws passed.
She said the split within Syriza was between hard-left MPs — “some of whom have spoken of a Greek exit from the eurozone as the only solution” — and those more sympathetic to Tsipras’s arguments.
Tsipras was forced to reshuffle his cabinet last week, having sacked three ministers for voting against the first bailout bill.
Government spokeswoman Gerovassili previously said the administration had “no intention” of calling early polls, and Tsipras told parliament on Thursday that he would keep fighting for Greece’s best interests, adding he would not “voluntarily abandon” the job.
“The left’s presence in government is a bastion for the defense of the interests of the people,” he said. “We will not be cowards. We will fight the battles we face with determination.”
Gerovassili said negotiations with Greece’s creditors would resume immediately after Thursday’s vote.
The EU’s Economic Affairs Commissioner Pierre Moscovici said they were aiming to finalize the deal by mid-August. Both sides are under huge pressure to finalize the terms of the rescue before August 20, when Greece owes the ECB a loan repayment of 3.2 billion euros it cannot afford.
By Katy Lee
Copyright Agence France-Presse, 2015