Greek Prime Minister Antonis Samaras faces the first real test of sentiment among lawmakers Wednesday as he begins the process of trying to elect a new head of state.
Lawmakers will hold the first of three possible votes at about 7 p.m. in Athens, with Samaras needing the support of 200 members in the 300-seat chamber to confirm his nominee, Stavros Dimas. The prime minister, whose governing coalition controls 155 votes in the parliament, needs to secure the appointment to avoid a snap election and will have his best chance of success on Dec. 29 when he’ll need the backing of just 180 lawmakers.
“Most of them will be keeping their cards close to their chest,” Costas Panagopoulos, chief executive officer at Alco, an Athens-based polling company, said. “If Dimas gets below 160 votes then things are really difficult. But essentially we’re talking about 30 or so that we’re not sure about, and they won’t reveal their intentions on the first vote.”
Samaras triggered a selloff in the country’s stocks and bonds last week when he decided to bring forward the vote on a new president. Opinion polls indicate that the opposition party SYRIZA, which wants to roll back many of the budget cuts Samaras pushed through to obtain international aid, would start favorite.
The yield on benchmark Greek 10-year bonds rose to 9.06 percent yesterday. Still, that was eclipsed by three-year notes yielding 10.83 percent, a sign that investors are concerned the government may default. The Athens Stock Exchange index, which dropped 20 percent last week, fell 0.3 percent.
A tally of more than 170 votes for Samaras’s candidate would be positive for markets, according to Athanasios Vamvakidis, head of G-10 foreign-exchange strategy at Bank of America Merrill Lynch in London.
“What could improve the government’s chances is if they promise early elections in September,” he said. “That could give some independents and smaller parties an excuse to argue they just want to address the negative market reaction.”
Samaras’s search for votes is focused on three groups: 24 independent lawmakers, 12 members of Independent Greeks, a group which split from the prime minister’s party in 2012, and 10 members of Democratic Left. Nine of the independents said in interviews that they are ready to back Dimas.
Independent Greeks and Democratic Left have committed to voting against Dimas, but both are struggling to maintain control over their lawmakers as their support among voters declines.