Greek politics: Cool heads

Date: 31/01/04

A change of leadership may still not bring a socialist election victory

GEORGE PAPANDREOU appears to sail through life with remarkable calmness. Whether galvanising the faithful at noisy rallies, or parleying with Brussels and Washington from remote Greek villages, the foreign minister - and leader-designate of the ruling socialist party - looks cool and unruffled.

And yet he has reason not to be. The polls suggest that his Pan-Hellenic Socialist Movement (Pasok), which has been in power for 19 of the past 22 years, will lose the election on March 7th. So far, the Papandreou effect-the fact that many voters like the man more than his party - has not sufficed to reverse the opposition's lead.

Admittedly, the edge enjoyed by New Democracy, the centre-right opposition party, plunged to 2 points after it emerged earlier this month that Mr Papandreou, not Costas Simitis, the prime minister, would lead Pasok into battle. But Mr Papandreou's halcyon phase proved short-lived. New Democracy's lead widened again as details emerged of a sleazy affair that seemed to epitomise the sharp practices that Pasok has failed to uproot.

The opposition sniffed blood after a deputy economy minister, Christos Pachtas, used a quiet parliamentary moment to push through an amendment to allow holiday homes to be built on sensitive coastal land in northern Greece. When it became obvious that this move was an ugly piece of cronyism, it was denounced by Pasok's leaders, and the guilty were held to account. Mr Pachtas resigned in disgrace, and he and nine other deputies who backed the amendment have been excluded from the election. Fresh legislation will reverse the concession to developers; but the electoral fall-out could still be felt.

Mr Papandreou has also had to react nimbly to an acceleration of diplomatic moves over Cyprus, which could make or break the Greek-Turkish rapprochement that is his biggest achievement as foreign minister. A month ago, the Greek side of the Cyprus conundrum was basking in moral authority, after the UN had blamed the Turkish-Cypriot leader, Rauf Denktash, for wrecking its latest bid to reunify the island; and the Greek-Cypriot government was looking forward to joining the European Union - and hence to a surge in its bargaining power - on May 1st.

But on January 24th, the Turkish side deftly regained the initiative by calling for a fresh round of negotiations, using the UN plan as a “reference point”, not a blueprint, and floating the idea of an early referendum on some bits of a settlement. To any Greek politician, especially one in the throes of an electoral contest, that sounds like a trap. For it may mean locking in concessions that are painful to the Greek-Cypriots-sharing power and money with their Turkish neighbours - with no promise of the demilitarisation or internal boundary adjustment that the Greeks most keenly desire.

In all this Mr Papandreou's gifts, including the use of his personal authority to break the foreign-policy mould, will be tested to the limit. A soft-spoken consensus-builder, he has never built a power base in Pasok, relying instead on name recognition as the son of a populist prime minister, Andreas Papandreou. Politics is a family business in Greece: Costas Karamanlis, the New Democracy leader, is the nephew and namesake of a respected prime minister, and even reformers seem to find that the dynastic factor still counts.

Born in America and educated in Sweden and Britain, Mr Papandreou sounds kinder and gentler than many Greek politicians, including his late father. After Mr Simitis, nicknamed “the book-keeper” because of his interest in financial minutiae, Mr Papandreou's Clintonian style - with his talk of social inclusiveness, and the folksy electronic diary that he posts on the web - makes a welcome change to Greeks.

Yet both election rivals still need to find answers to problems that Mr Simitis has failed to solve: creating more jobs, tackling corruption and removing bureaucratic hurdles that deter foreign investors. Although the stadiums are close to completion, the Athens Olympics in August will be a big challenge for the election winner. Organisers fret about putting the security measures demanded by American and British advisers in place in time. The games could exceed their €4.6 billion ($5.8 billion) budget by a wide margin, say bankers in Athens. Mr Papandreou may yet defy the polls - but whoever takes power in March will find his in-tray overflowing.