June 21 - Greece's Prime Minister George Papandreou is facing a confidence vote - the first of three tests the government must survive to avert the euro zone's first debt default. Sonia Legg reports.
Greek Prime Minister George Papandreou is fighting for his political life but there's far more at stake. A late night confidence vote in the government will determine whether the country is likely to swallow the latest austerity pill in order to qualify for another instalment of financial aid. There's every chance Papandreou's government will win despite the obvious anger of those demonstrating outside parliament. Many of these protestors work for state-run companies which will be sold off as part of a five-year reforms package. (SOUNDBITE)(Greek) MARIA KOUBLI, PRESIDENT OF THE WORKERS UNION AES SAYING: "We are here to stop the sale of the defence industry and we will be here every day in order to protect it." But the anger in Athens contrasted with signs of market relief. The euro and European and Greek stock rose on expectations of a positive vote. Economic analyst Platon Monokroussos (SOUNDBITE) (English): ECONOMIC ANALYST, PLATON MONOKROUSSOS, SAYING: "I think there is a very strong probability that the government will survive the confidence vote today and also the majority of MPs, the single majority required, will vote in favour of a medium-term fiscal plan." The EU won't pay its chunk of the latest 12 billion euro aid instalment unless new reforms are agreed and the IMF won pay its quarter share unless the EU does. And even if the payment does come through, it will only buy Greece a little more time. The country needs a far bigger aid package to handle its debts in the longer term. Nomura's Alastair Newton: (SOUNDBITE) (English): ALASTAIR NEWTON, SENIOR POLITICAL ANALYST, NOMURA, SAYING: "The main challenge is going to be on implementation and I think there are some real question marks to be asked over whether Greece's leaders, with the best will in the world, will be able to secure sufficient public support, and parliamentary support in the individual measures, to push through what they are being asked to do by the EU and IMF." If the government survives the confidence vote it will have until the end of June to pass the reforms. Sonia Legg, Reuters.