Greece ‘to hold snap September election’ as Tsipras faces party rebellion

In the Netherlands, a majority of lawmakers also backed the new Greek rescue after a heated debate in which Prime Minister Mark Rutte was attacked for reneging on an election pledge to not approve another bailout for Greece.

German Finance Minister Wolfgang Schaeuble said there was no guarantee that Greece’s third bailout would work, but stressed it would be irresponsible not to give the indebted nation the opportunity for a new start.

Schaeuble last month floated the prospect of Greece taking a “timeout” from the euro as an alternative to a fresh bailout, horrifying some eurozone partners but convincing voters at home of his vigilance on conditions of aid to Athens. Greece’s previous conservative government had agreed to those bailout terms.

European bailout fund supervisors on Wednesday approved the release of billions of euros to help rebuild Greece’s devastated economy just as a new debt payment looms.

The new bailout package of up to 86 billion euros ($95.66 billion) for 32.5 years includes up to 25 billion euros to recapitalise Greek banks, of which 10 billion will be immediately available, according to the ministry. With the support of smaller pro-European Union parties such as The River and Pasok, the election victor “could create a strong coalition that will be able to pass and implement reforms“.

After days of rumours about what the government would do next, government officials said the previously cited option of a confidence vote had been shelved and the idea of calling snap polls as early as mid-September had become more likely.

Syriza is expected to call a party congress in September to resolve differences with the rebels. Tsipras and his radical left Syriza party came to power in January promising to scrap such spending cuts and tax hikes. No polls have been published since then due to the holiday season.

The prolonged stand-off forced Athens to shut its banks for three weeks and impose capital controls before Tsipras accepted the bailout under threat of a financial collapse and Greek exit from the euro currency. “The political landscape must clear up”.

“These elections which, as I hear, are ahead, will not be the same as those in 2012”, said Mr Tsakalotos, who also urged Greeks to start putting deposits back in the banking system.

Some MPs suspect that the deal could lead to part of Greece’s large debt being written off – with EU taxpayers having to foot the bill.

A government official said yesterday that until Greece had secured the new funding, it would focus exclusively on the technicalities which need to be wrapped up.

The timing of elections, and what they would mean for Syriza and the government, remain uncertain. “My feeling is that Syriza will have an absolute majority”, Dimitris Papadimoulis, a Syriza lawmaker in the European parliament, told Mega TV.