EU hails ‘encouraging’ Greek vote backing new bailout

EU-parliamentGreek lawmakers finally voted through the country’s third massive international bailout Friday after a bitter all-night debate, hours before European finance ministers were to meet to approve the deal with Germany digging in its heels.

A European Commission spokeswoman welcomed the “encouraging vote” and said it was “entirely feasible” that the Eurogroup ministers meeting later in Brussels would rubberstamp the 85-billion-euro ($95-billion) rescue plan.

Greek Prime Minister Alexis Tsipras had warned that any German bid to palm off his debt-laden country with a bridging loan rather than a new deal would be “a return to a crisis without end”.

Tsipras appealed to the European ministers — who are due to meet from 1300 GMT — to reject the alternative solution proposed by Germany, which he claimed would only prolong the agony.

“It is what certain people have been looking for systematically, and we have a responsibility to avert that, not to facilitate it,” the embattled premier told parliament after a day and night of heated debate on drastic austerity measures that saw a third of his radical Syriza MPs rebelling against the government.

The Greece stock market fell as fears of an early election grew.

Athens needs to unlock bailout funds before a 3.4-billion-euro repayment to the European Central Bank falls due on August 20.

A majority of 222 lawmakers approved the bailout with 47 from Tsipras’ own leftist party ranks either voting against or abstaining.

Outspoken former finance minister Yanis Varoufakis was among those who refused to support the three-year deal, the rejection of which the premier had warned would force him to call early elections.

Tsipras, who won elections in January pledging to end austerity, said failure to ratify the deal would allow Germany to push for a bridging loan instead.

Berlin, Europe’s paymaster, is insisting on further clarifications from Greece before giving the deal the nod.

– ‘Prefer compromise to suicide’ –

Facing down critics in his own party, Tsipras told MPs: “I prefer compromise to the heroic dance of Zalongo” — a reference to a notorious 19th-century mass suicide in northern Greece when a group of women and children jumped to their deaths rather than submit to the cruel Ottoman governor Ali Pasha.

His government “had taken on the responsibility to continue the fight rather than commit suicide and then go running to other international forums saying it wasn’t fair that we had to kill ourselves,” he added.

Tsipras had argued there was no choice but to agree to he swingeing cuts and sell-offs demanded by its international creditors “to assure the country’s ability to survive and keep on fighting.”

The highly-charged debate began in parliamentary committees on Thursday, and raged on through the night in the full chamber.

The vote was held up by procedural wrangling from hardline parliament speaker Zoe Constantopoulou, who termed the bailout unconstitutional, and declared she could “no longer support” the prime minister.

“Every corner and beauty of Greece is being sold,” she said.

“The government is giving the keys to the troika along with sovereignty and national assets,” she added, referring to the country’s creditors — the EU, the European Central Bank and the International Monetary Fund.

She said Tsipras had now “joined the cohort of his predecessors who had accepted the (Brussels) memoranda, throwing his comrades to the dogs… That hurts.”

But it was unclear if Constantopoulou would join former energy minister Panagiotis Lafazanis, who is forming a breakaway pro-drachma party. Varoufakis, however, has said he still supports Tsipras.

The drama now moves to Brussels where eurozone finance ministers are expected to issue their verdict on the draft deal reached by Athens and officials from the creditors after weeks of negotiations.

German deputy finance minister Jens Spahn sounded a note of caution about the prospects of a final deal there, saying Berlin and Paris still had questions on Greece’s plans to privatise parts of its economy.

The Greek government had “come a long way”, showing a “high degree of willingness to reform”, Spahn conceded.

“We need more details in some areas. That is what we need to talk about,” he said, speaking of a joint French and German proposal without giving details.

Bundestag president Norbert Lammert has said that in the event of a thumbs-up from Greek lawmakers and the Eurogroup, the German parliament will convene an extraordinary session on August 18 or 19 to vote on the bailout.

– Unexpected growth –

Better-than-expected growth forecasts gave Tsipras a boost going into the vote and eurozone meeting.

Thursday’s official estimates showed the economy expanding 0.8 percent in the second quarter — despite the cash-strapped government imposing capital controls to prevent a bank run.

But EU forecasts Wednesday showed the Greek economy — which only emerged from six years of brutal recession in 2014 — shrinking 2.3 percent in 2015 and 1.3 percent in 2016.

Finland on Thursday was the first eurozone peer to give its approval to the deal, albeit with numerous conditions.

Several other European parliaments need to approve the bailout, and the IMF said Thursday it wants Greece’s European partners to decide on the package of debt relief before determining if it will take part in the rescue.

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