ATHENS - Greece’s two probailout parties appeared likely Monday to agree on forming a coalition government after a bruising election watched closely because of its potential impact on the world economy, but negotiations were pushed to a second day after the head of the socialist party insisted on a broad partnership.
Sunday’s vote - the second national election in six weeks - again left no party with enough votes to form a government on its own. Antonis Samaras’s conservative New Democracy party won the most seats in Parliament and was leading efforts to forge a coalition.
The socialist PASOK party, led by former finance minister Evangelos Venizelos, came in third. But its 33 seats in the 300-member Parliament enable it to form a government with New Democracy, which gained 129 seats. A coalition would have to have a minimum of 151 seats combined in order to form a government.
Both PASOK and New Democracy have said they will stick to Greece’s international bailout commitments, although they want to renegotiate some of the harsh austerity measures imposed in return for the international rescue loans that have kept the country afloat since May 2010.
The election results eased fears that Greece faced an imminent exit from Europe’s joint currency. A Greek exit from the 17-nation eurozone would have potentially catastrophic consequences for other ailing European nations and hurt the United States and the entire global economy.
President Obama and other world leaders voiced relief over the possible formation of a pro-austerity government, cautiously calling it a positive opportunity for the country to overcome its crisis. The president called on European nations to work together with the new Greek leaders to make the bailout happen.
As head of the party that came first in the election, Samaras was given the mandate Monday to seek coalition partners.
Under the Greek Constitution, he has three days to reach an agreement. If he fails, the Syriza party, which came in second, will get three days to try. Syriza, a radical left-wing party, opposed the bailout terms.
“With Mr. Venizlos we agreed that within the deadline of my mandate . . . a government of national salvation must absolutely have been formed,’’ Samaras said after talks with the socialist leader. “We will, of course, have new meetings.’’
Samaras also met Monday evening with Fotis Kouvelis, the head of the small Democratic Left party that finished sixth in Sunday’s vote. He said afterward that the meeting was fruitful and would be repeated Tuesday.
Kouvelis’s party had been seen as a potential partner for PASOK and New Democracy after inconclusive elections on May 6. Those coalition talks collapsed after 10 days of wrangling, triggering last Sunday’s elections.
Syriza has refused to join the other two parties in a government, saying it will not cooperate with any group that insists on implementing the harsh austerity measures taken in return for Greece’s two international bailout agreements.
Venizelos, however, has insisted on a broad coalition. “The most crucial thing for us right now is to achieve the greatest possible range of consensus, and this must happen by tomorrow night at the latest,’’ he said. He also criticized Syriza chief Alexis Tsipras for his refusal to join in governing Greece. “You can’t have some people choosing the easy position of being in opposition and lying in wait for the government to fail - or rather trying to create the conditions for the government, that is the country, to fail,’’ Venizelos said.
In a joint statement, European Council president Herman Van Rompuy and European Commission president Jose Manuel Barroso also said that fiscal and structural reforms were the best way for Greece to overcome its economic challenges.
But an early-market rally faded quickly Monday as investors turned their attention back to the other financially unstable economies in Spain and Italy. Greece has survived for more than two years on rescue loans from its European partners and the International Monetary Fund. The vital bailouts are conditional on Greece continuing with its unpopular package of spending cuts and pushing through new structural reforms.
Athens has pledged to push through new savings worth nearly $18.9 billion, raise billions in company and real estate privatizations, and sack about 150,000 civil servants.