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Greek Socialist leader gets chance to form government

By the CNN Wire Staff
May 11, 2012 -- Updated 0717 GMT (1517 HKT)
  • NEW: Socialist leader Venizelos calls talks a "first step" toward a coalition
  • Opinion poll suggests the leftist Syriza party would win most votes in a new election
  • Two other politicians say they can't get enough backing from other parties to form a coalition
  • If no government is formed by May 17, Greece has to call new elections

Athens, Greece (CNN) -- The leader of the socialist PASOK party in Greece is starting efforts to build a government, his party said, making him the third Greek politician since Sunday to try to do so.

PASOK leader Evangelos Venizelos held meetings with the leader of the Democratic Left party, Fotis Kouvelis, in what Venizelos called a "first step" toward assembling a coalition of pro-European parties. He is scheduled to hold talks with head of the center-right New Democracy party, Antonis Samaras, on Friday.

Samaras and another potential coalition partner -- Alexis Tsipras of the leftist Syriza party -- have tried and failed to organize a government already. If no one can pull together a coalition, and no national unity government can be formed by May 17, Greece must call new elections.

Venizelos, who has three days to cobble together a deal, said Sunday's fragmented results show voters don't trust "any party on its own." But he says he wants Greece to stay in the eurozone, the group of 17 European countries that use a common currency.

"It is a given that we want Greece in the euro," he said. "We want something better, not something worse."

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Greece has been forced to impose punishing austerity measures to get international loans that have kept it from defaulting on debts. The election results were widely seen as a message to politicians to back away from the harsh economic austerity measures.

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Voters backed parties on the far left and right, withholding support from PASOK and New Democracy, the more moderate parties that made up the coalition that enacted the cuts. Seven parties won seats in parliament in Sunday's election, but no party captured more than 19% of the vote.

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As Tsipras began coalition talks Tuesday, he said PASOK and New Democracy "don't have a majority any more to vote for the plundering of the Greek people."

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PASOK placed third in the election, behind New Democracy and Syriza. The latest opinion poll, by Marc-Alpha TV, suggests that if new elections are held, Syriza would come out on top, with nearly 24% of the vote, followed by New Democracy with 17.4% and PASOK with just under 11%. A coalition would still need to be formed.

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Extreme-right party Golden Dawn would take a smaller share of a second vote than on Sunday, the poll suggests, but would still pass the threshold to have lawmakers in parliament.

A European Commission spokeswoman said this week that Greece needs time to work through its political process, but she reminded the country's leaders that they would be expected to abide by the terms of a bailout program meant to avoid a crippling financial meltdown.

"The commission hopes and expects that the future government of Greece will respect the engagements that Greece has entered into," spokeswoman Pia Ahrenkilde Hansen told reporters.

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New Democracy ended up with 108 seats in Greece's 300-seat parliament. Voters also delivered a rebuke to PASOK, leaving it with 41 of the 160 seats it held before Sunday's vote. Together, the parties fell short of the 50% necessary to continue their coalition, requiring formation of a new government.

Last year, Greece's debt threatened to force it to drop Europe's common currency, the euro, prompting the European Central Bank and other lenders to swoop in with emergency funding. In exchange, they demanded that the government slash spending.

The resulting measures have led to tax increases and cuts in jobs, wages, pensions and benefits -- and significant public outcry.

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The national unemployment rate for January, the latest month for which figures are available, was nearly 22%, prompting widespread protests and leading some young people to leave the country in search of work.

Youth unemployment is even higher than the national average of one in five out of work.

For two years, the country's massive amount of debt has threatened the stability of the eurozone.

Greece pushed through a huge debt swap in March to save it from disorderly default and clear the way for it to receive a second bailout from the European Union, the European Central Bank and the International Monetary Fund, worth €130 billion ($171.5 billion).

The debt restructuring deal gave some breathing space to the eurozone bloc, where fears that Greece might collapse had increased pressure on other debt-laden nations such as Spain and Italy.

CNN's Antonia Mortensen and Matthew Chance and journalist Elinda Labropoulou contributed to this report.

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