Athens - AFP
Greece\'s future hung in the balance on Sunday as MPs debated new austerity measures to avoid default, with the finance minister urging lawmakers to pick the lesser of two evils. Opening the debate, Evangelos Venizelos underlined the importance of backing the government-approved plan needed to unlock a 130-billion-euro ($171 billion) rescue fund from the EU and the IMF, saying Greece risks bankruptcy otherwise. \"The situation is very clear. Tonight at midnight before the markets open the Greek parliament must send the message that our nation can and will (support the debt-deal),\" Venizelos said. \"Today we must understand, and persuade Greek citizens, that when you have to choose between something bad and worse, you will chose the bad to avoid the worst from coming,\" he added. Thousands of demonstrators massed in front of parliament to protest what they describe as blackmail being imposed by the international troika of the EU, the IMF and the European Central Bank. Deputies were not expected to vote on the measure before 2200 GMT. On the eve of the vote, Prime Minister Lucas Papademos warned the country that \"we are a breath away from Ground Zero.\" He urged deputies to grasp their \"historic responsibility\" to secure the country\'s financial future and warned of \"economic and social catastrophe\" if parliament failed to agree to the deeply unpopular cuts needed to secure the international rescue. MPs will have to approve moves to recapitalise Greek banks, which may involve a degree of nationalisation if they cannot get sufficient private money. And they must back a bond swap which, after long and tortuous negotiations, has finally been agreed with private creditors. That is designed to wipe out around 100 billion euros from Greece\'s 350 billion euro debt, reducing the country\'s massive debt burden to 120 percent of GDP. Venizelos revealed that the government has a deadline of February 17 to carry out the bond swap in order to prevent bankruptcy. \"If Greece does not rise to the occasion, then we will not be able by Friday, February 17, to officially begin the process of bond swapping so that Greece can get rid of the burden of 100 billion (euros) of public debt,\" he said. This is because if that timeline is missed, \"we will not be able to swap the bonds by March 5 (and) we won\'t have time to resolve the issue of paying the bonds that mature between March 14 and 20,\" Venizelos said. \"If that does not happen, the country will be bankrupt,\" he added. If deputies reject the package however, Greece will not get the funds it needs by March 20 to repay nearly 14.5 billion euros in maturing debt. \"We look into the eyes of the Greek people with full consciousness of our historic responsibility. The social cost of this programme is limited in comparison with the economic and social catastrophe that would follow if we do not adopt it,\" Papademos said Saturday in his televised address. \"The standard of living of Greeks would collapse in the case of a disorderly bankruptcy. The country would drift into the long spiral of recession, instability, unemployment and prolonged misery.\" The two remaining parties in the ruling coalition, PASOK the largest party and the conservative New Democracy are backing the measures and account for 236 out of a total of 300 deputies, but some MPs are certain to reject the measures. However, there are signs of growing unrest in the government ranks. Two PASOK junior ministers and four members of the far-right LAOS party have quit the cabinet in protest in the run-up to the vote. The head of the International Finance Institute (IIF), Charles Dallaras, urged Greek lawmakers to pass the painful austerity measures demanded by creditors. \"It is very important for the MPs to understand what is at stake and to recognise that beyond austerity, which is part of the long-term dimension of this program, there are many tangible benefits for Greece and the Greek people,\" Dallaras said in an interview to Kathimerini newspaper on Sunday. But the proposed measures are expected to heap more hardship on ordinary Greeks already suffering from the crisis. They involve a 22-percent cut in the minimum wage (32 percent for anyone under 25); deregulating the labour market to make it easier to lay off workers; and a package of tax and pensions reforms that have provoked a wave of protest.