Since 2010, Greece has been almost exclusively reliant on two bailouts totalling €240B, from both Europe and the International Monetary Fund. In response to receiving the bailouts, each government in power since 2010 has imposed spending cuts that have reduced Greek incomes by more than a third. This has resulted in a bleak recession and has garnered increasing resentment from the country’s citizens, 25% of which are currently unemployed.
The second bailout expired earlier this year, and former Prime Minister Alex Tsipras of the Syriza party told Greece that he would negotiate with the creditors in the country’s favour. However, talks did not go well and ended in Tsipras calling for a referendum, pressuring Greeks to vote against creditor demands. They did, but Tsipras ultimately signed a deal that imparted even harsher terms than those he had promised to abolish during the January elections. This move catalyzed a rebellion within his party, and forced him into resignation.
His four-year term only lasted seven months, and he currently stands accused by pro-European opposition parties of rushing the impending election before voters are impacted by the new tax measures. Tsipras argued that he had no other choice but to accept the European creditors’ terms in order to save the country from defaulting on its debts and being forced to leave the euro.
What’s Happening Now?
Supreme Court top judge, 65-year-old Vassiliki Thanou, was sworn in as interim Prime Minister yesterday, and will lead Greece until a new government is formed based on the vote expected to take place on September 20. Thanou is Greece’s first female prime minister. Her newly appointed Cabinet will be sworn in on Friday, which is also when the upcoming election date will be formally confirmed.
Her appointment was announced by Greek President Procopis Pavlopoulos after parliament’s three biggest parties were reportedly unable to find willing coalition partners. Former energy minister Panagiotis Lafazanis, who created the brand new Popular Unity party after splitting from Syriza last week, last held the mandate to form a new government.
Despite all the drama surrounding Tsipras, he is expected to win the next election. However, he will most likely have to govern the country alongside another party, as he probably won’t secure enough seats in Parliament to do it alone. Tsipras has already voiced his refusal at a coalition with the centrist opposition parties: centre-right New Democracy, socialist PASOK party, and centrist To Potami party. His current coalition partner is the nationalist Independent Greeks party, but they may struggle to gain the few seats required of them.
It is almost certain that Tsipras will not form a government with the Popular Unity party, the pro-Nazi Golden Dawn, or the communist KKE party.