Greece's new prime minister meets party leaders

Associated Press
Leader of Conservatives New Democracy party Antonis Samaras makes statements after his meeting with Greece's newly installed caretaker prime minister Panagiotis Pikramenos at the Greek Parliament in Athens, Monday, May 21, 2012. Greece is set to hold elections on June 17 to end a political deadlock after a previous vote on May 6 produced a hung Parliament, with the country's future in the 17-nation eurozone potentially at stake. (AP Photo/Thanassis Stavrakis)
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ATHENS, Greece (AP) — Greece's newly installed caretaker prime minister conferred with party leaders Monday ahead of this week's European Union summit that's expected to focus on ways of kick starting economic growth across the continent.

Panagiotis Pikrammenos, a senior judge who has no power to make any binding decisions, held successive meetings with all party leaders as campaigning gets underway for the country's crucial June 17 elections.

The vote is seen as a choice on whether debt-stricken Greece stays in the euro. A May 6 poll produced no government and triggered a political crisis.

The vote was split between parties that insist the country lives up to its austerity pledges and continues to receive outside assistance to stave off bankruptcy, and those that want to revoke or revise them because they are too punishing.

Antonis Samaras, leader of the center-right New Democracy party, laid out the hope that the 17-country eurozone may soon back jointly issued bonds, despite another rejection by Germany. So-called eurobonds could be used to fund growth projects and spread risk around the eurozone. Germany has been unwilling to push the idea of eurobonds because they would likely raise its borrowing costs.

"Now that Europe is changing and is adopting growth, Greece must benefit," Samaras said after talks with Pikrammenos. "But to benefit, we have to stay inside the euro and win measures that will allow our economy to grow quickly and relieve Greek society."

A raft of opinion polls over the weekend suggested that the new elections will be tightly contested, with New Democracy and the Radical Left Coalition, or Syriza, fighting for first place.

Coming first is crucial in Greek elections, because the winning party automatically gets a 50 seat bonus in the 300-member Parliament, no matter how slim its margin is over the runner-up. These extra seats could prove pivotal in the formation of the next government

Samaras received a boost later Monday, when the head of the small pro-European Democratic Alliance party, Dora Bakoyannis, said her party was suspending its operation and joining with the conservatives for the forthcoming election. Democratic Alliance won 2.55 percent in the May 6 vote.

Bakoyannis, a former conservative who was Greece's first female foreign minister, formed her party in late 2010 after breaking with New Democracy.

"We all have the duty to form a strong front of the forces that want Greece to be an active and strong member of the European Union and the eurozone," she said.

Separately, another two pro-European and pro-bailout parties that missed the 3 percent Parliamentary threshold on May 6 said they were joining forces. Based on their showing in the past election, the two combined would get about 4 percent.

Evangelos Venizelos, the leader of the center-left PASOK party that won the 2009 election in a landslide, said that he urged Pikrammenos to persuade Greece's EU partners to release funds earmarked for large-scale, growth-oriented projects.

"The European Commission's mindset has to change," Venizelos told reporters. "We constantly come up against bureaucratic and legal obstacles."

Venizelos said he backs the idea of eurobonds — as long as they offer better repayment terms for Greece than what's being offered under the current bailout deal.

He also urged that half of the €50 billion ($63.6 billion) earmarked to prop up ailing Greek banks be released immediately to ease the pressure on the banking system. Since the election, there have been large-scale withdrawals from Greek banks as depositors fretted over the country's future in the eurozone.

"All those who have reservations about the bailout agreement and don't want it, condemn it and consider it as something that must be cancelled, do they want us to have this money, or do they think that we'll get this money but we won't adhere to the agreement's terms?" Venizelos said in a thinly veiled attack against anti-bailout parties.

Once Greece's biggest parties that alternated being in power for close to four decades, New Democracy and PASOK are the most vocal advocates in support of the country sticking to the austerity course.

But they saw their support cut by half as voters angry with two years of tough cuts that saw pensions and salaries slashed and taxes hiked cast their ballots on May 6 for several anti-bailout parties to the left and right of center. Syriza came in a surprise second place behind New Democracy.

Panos Kammenos, leader of the anti-bailout Independent Greeks party, said growth-oriented measures are a must, but insisted the bailout had to go.

"The rejection of the bailout must happen immediately and it must become abundantly clear that the real economic situation can't allow this to go on," he said after meeting Pikrammenos. "It's clear that the bailout is leading the people and the economy toward a dead end."

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