NEW COALITION GOVERNMENT SWORN IN

Watch Atlas sprint

by George Gilson 11 Nov 2011

Members of the newly appointed government swear in during a ceremony at the presidential mansion in Athens, 11 November 2011. REUTERS/Yiorgos Karahalis Lucas Papademos’ new coalition government is hitting the ground running, with a cabinet meeting following the swearing in ceremony at 4pm. The release of a sixth tranche of EU-IMF loans, to the tune of eight billion euros, is the government’s most pressing priority. Then it must undertake the daunting task of passing and implementing the harshest austerity programme in decades. The new government’s programme will be presented in a televised address by Papademos, during the government’s first confidence vote, expected by Sunday night. The new cabinet is the product of 24-hours of feverish negotiations, reflecting balances within and between parties, as well as between the new prime minister and the three coalition partners. The vast majority of ministers are from Pasok -most keeping their former posts - which retains its parliamentary majority. But there is broad, high-level representation by the other two coalition partners: main opposition conservative New Democracy and, further to the right, Yiorgos Karatzaferis’ Popular Orthodox Rally (Laos). In a sign of stability, Finance Minister Evangelos Venizelos and two of his deputies will stay on. But it is clear that economic policy will be fashioned and monitored personally by Papademos, a former vice-president of the European Central Bank. As deputy finance minister, a top economic advisor to conservative New Democracy leader Antonis Samaras, University of Macedonia macroeconomics professor Yiannis Mourmouras, will guarantee an input of ND, which has maintained it has a better economic policy mix than that followed by Greece’s EU-IMF lenders. New Democracy’s fate is now inextricably linked to that of Greece’s bailout, as the main opposition has picked up the top portfolios of foreign affairs and defence. Former European Commissioner Stavros Dimas, a moderate who until now was one of two ND vice-presidents, will undertake to repair Greece’s damaged credibility both within the EU and internationally. He takes office at a time of economic crisis when many believe there may be challenges to Greece’s national interests. Mild-mannered, Dimas has held top cabinet posts in older ND governments. Dimitris Avramopoulos - a former diplomat-turned-politician who has served as health minister and earlier as Athens mayor, takes the defence portfolio at a time of heightened Turkish threats over Cyprus’ hydrocarbon programme. Papademos chose one of his most trusted confidants, former Pasok minister Tassos Giannitsis to assume the crucial interior ministry. There, he must lay the groundwork for the restructuring and rationalisation of Greek public administration. He must also undertake the painful implementation of the unified pay structure, with deep, new civil service wage cuts. Both Papademos and Giannitsis, another disciple of fiscal discipline, were close friends and in the inner political circle of former Pasok premier Costas Simitis, who ruled with the mantra of modernisation. The new boy on the block is Yiorgos Karatzaferis’ rightwing Laos party. He was rewarded for his long-standing advocacy of a coalition with four government portfolios, taken by his top MPs and his party’s vice-president. Makis Voridis MP takes the key infrastructure transport, and networks ministry, at a time when the unblocking of four major highway projects is crucial for releasing EU funding and spurring development. He will also have to deal with the huge backlash from taxi drivers and truckers against the liberalisation of their industries. Horst Reichenbach, the head of the European Commission Task Force that will oversee implementation of the Greek bailout terms, cited the highway projects as a top priority. The other three Laos posts are at the level of deputy minister, including Adonis Georgiadis as deputy development minister, responsible for shipping. Many, including ND, have advocated the restoration of a separate shipping ministry, as Greek shipowners play a leading role in international shipping. Asteris Rontoulis becomes deputy minister for rural development and food. Former ambassador Georgios Georgiou, Laos vice-president and Karatzaferis’ closest party confidant, will serve as alternate defence minister. Four women will sit in the cabinet: Education Minister Anna Diamantopoulou, Alternate Foreign Minister Mariliza Xenoyiannakopoulou, Alternate Interior Minister Fofi Yennimata, and Deputy Education Minister Evi Christofilopoulou. All four were in the former Pasok government. The parliamentary debate (usually three days) leading to the constitutionally mandated vote of confidence is expected to begin later today or tomorrow. Received after the swearing-in ceremony by the outgoing premier at the prime minister’s mansion, Papademos praised George Papandreou’s “huge effort over the last two years” toward stabilisation and adjustment.