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Greek PM Calls Referendum Over “Haircut”-Agreement

Greek prime minister George Papandreou announced referendum over the October 26th, 2011 Loan-Agreement  (“Haircut”-Agreement) stunning the public. It was the PM’s answer to all criticism by the opposition, the society and even some of his own deputies, the request for early elections and/or government of national unity. Speaking to parliamentary group of PASOK Papandreou also announced that he will ask vote of confidence in the parliament.

“The citizens will express themselves democratically about the new loan-agreement and their mandate will be bounding for all of us” said Papandreou. “The citizen will decided if he wants that we adopt the new laon agreement or we reject it. If the Greek nation does not want it, it won’t materialize.”

Papandreou did not reveal exactly what would be the question of the referendum that will most likely be held in January 2012.

Alternate Foreign Minister Mariliza Xenogiannakopoulou explained during a talk show in ALTER TV om Monday evneing  that the question would be “Do you want the new loan agreement ?-yes or no”. At the same talk show Justice Minister Xaris Katsanidis said that the question woul dbe more or less “Do you accept the new loan agreement in its full length” and will refer to Greece’s commitments to the agreement. 

The announcement triggered negative reactions by the opposition parties, with three of them (left-wing, far-right, centre) rejecting it right away. SYRIZA, LAOS, Nea Dimokratia and Democratic Coalition claimed that the referendum would lead the country into ‘dangerous paths’, a view shared by many journalists. 

The referendum-bombshell raised many questions with the main of them being : What would NO mean in the referendum? An exit from the eurozone and bankruptcy? And what will be the political consequences should the majority votes NO. Most likely early elections… Another question is how the perspective of the referendum will influence tha banks-EU talks on the haircut. And how the markets will react, as they do not behave in “PASOK time”.

The referendum will be held a ‘crucial national issue’. That means it will be held before the loan -agreement wouldbe voted in the parlieamnet and become a law so that the government would bypass Constitutional provisions that forbid a referendum on ‘fiscal issues’. Further the referendum will be possible after the detail agreement between EU and Greece. 

The vote of confidence will be held on Friday, November 4th, 2011 at midnight. Ruling party PASOK with 153 seats (out of 300) does have the majority to pass the vote of confidence – however Papandreou challenges some of his own deputies who criticize him and some of them demanding early elections, some others ‘government of national unity’.

Already people ask” Why weren’t we asked before the country s

God help us!

PS I will have to read 100 pages of Loan-Agreement full of economics and technical details in order to be able to vote…. *sigh”. I have to agree wit the opposition speaking of ‘another blackmail’….

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  1. My gut reaction is: this is not blackmail. This is the umphteenth instance of a Greek government dodging it’s responsibilities. The PM is admitting that parliamentary democracy in Greece died. The politicians are now passing the buck to the people… Will they resign, now they admitted they are no longer able or willing to do the job they were hired to do?
    Just initial thoughts… More will ripen tonight…

    • the PM is escaping his own responsibilities and urges my grandma to take decisions. new slogan “people’s will” hahaha
      Everybody is calling for early elections – louder than before.

      • the referendum should have been done in 2010 when we had options and when this choice first appeared. do we go to the imf or not, and so on. now its only done so that if the answer is yes then they can pass anything they like easily and if anyone reacts or the opposition disagrees they can say are you going against the will of the people who said “yes”. and if the referendum result is “no” then they can blame the people for the bankruptcy and the exit from the euro that will follow. it will not be PASOK fault. i expect that in the following couple of months the usual pro goverment papers and channels will start an unprecedented fear campaign of what will happen if greeks vote no. it will make the fear mongering from the mesoprothesmo look tame. honestly the only good thing that will com eout of this is the uncertainty it causes to the big europeans who have made plans on the back of whether greece bankrupts or not. the german with their constant we will have people checkin gup on you attitude and so on. its a way of bringing more political chaos to europe. its like papandreou is saying i know you think we have no power to make decisions and we simply say yes but i can add the random factor. those were some of my thoughts as i read about the referendum. feel free to add or detract. KTG good job as always thank you.

        • untill the referendum comes, the Athens Stock Exchange will have disappreared form the StEX boards -then is this case, politics stay side by side with the markets.

      • The president should grant that wish for elections… But on one condition: every party makes a detailed alternative to the PASOK measures. No, not just “we will renegotiation” or “we won’t pay”. But real plans with timetables and a clear image about where Greece will be in say 10 years. Will Greece stay in the EU and/or euro. What are the priorities to pay for and how!
        Why? Because at the moment we do not have anything to choose between. And that’s what Papandreou is gambling on with this referendum. There will be no real choice… Yes, just a blackmail. And that will only be defused by elections with a viable choice.
        What is playing through my mind now is: what will happen to that 6th tranche that was due end of November to pay for the salaries and pensions… Will that still be payed out when the lenders had time to digest this Haloween trick of Mister Papandreou?

        • OH NO! Gap confused Halloween with 1st of April !???

        • I think 6. tranche was secured when multi-bill passed.

          • i guess when he said trick or treat they answered trick. antoni i agree with you about the choice of alternatives between parties but right now even the goverment doesnt have a plan. or the EU they all seem to be winging it and making it up as it goes along. the worse thing is they are trying to fix the problem based on the economic model that has caused most of the financial crisis in the world. world economics and politics has become so one dimensional that they cant think of anything different. they do the same things over and over and expect different results.