Mitsotakis' new conservative government has made boosting sluggish growth a priority
Athens (AFP) - Greece’s new parliament was sworn in Wednesday after July 7 elections, led by a conservative government that has vowed to cut taxes, boost domestic security and tighten borders against migration.
The six-party parliament will officially begin its functions after electing a speaker on Thursday.
New Prime Minister Kyriakos Mitsotakis will outline his government’s policies at the weekend before a vote of confidence on Monday.
His conservative government, which has a comfortable majority of 158 lawmakers in the 300-seat parliament, has made boosting sluggish growth a priority, powered by tax cuts and accompanied by privatisation deals.
The 51-year-old Harvard graduate and former McKinsey consultant has also pledged to create jobs and get rid of obstacles to business.
New Democracy, led by Mitsotakis, has a comfortable majority in the new parliament
On Tuesday, Athens placed seven-year bonds at a record-low yield in its first foray into the debt markets since the election, a measure of investors’ confidence in the new government’s direction.
Starting in 2020, Mitsotakis has promised to cut a hated property tax called ENFIA – brought in by a previous New Democracy-led government during the economic crisis – by 30 percent over two years.
He has also offered to reduce income tax thresholds and to gradually cut tax on business profits by eight percent.
But just hours after his July 7 victory, eurozone finance ministers warned the new government to stick to the country’s strict public spending commitments.
“We must keep our commitments, this is the only way I know to gain credibility,” said Eurogroup chief Mario Centeno.
On Tuesday, the eurozone’s bailout fund director and a key EU official overseeing Greece’s debt repayments, Klaus Regling, suggested that tax cuts be coupled “with a broader tax base.”
In a meeting with Regling later on Tuesday, Mitsotakis “confirmed that Greece would respect fiscal targets,” the prime minister’s office said.
During the election campaign, Mitsotakis said he would persuade Greece’s creditors to accept the easing of targets with “a comprehensive reforms package”.
The current framework negotiated with creditors by the previous leftist Syriza government holds Greece to a primary budget surplus of 3.5 percent to 2022 – but the conservatives say that target stifles growth.
- Tight borders, security -
Mitsotakis has also made tighter border patrols a top priority after accusing his leftist predecessor Alexis Tsipras of “filling Greece and Europe with migrants”.
The new junior minister for migration, Giorgos Koumoutsakos, this week said the government would speed up asylum background checks and pursue a “robust” programme of migrant returns to Turkey or their home nations.
Greece’s previous government had struggled to manage some 70,000 refugees and migrants, with around a fifth crammed in overcrowded facilities on Aegean islands facing Turkey, waiting for months for their asylum requests to be processed.
The conservatives also believe Tsipras was too lenient towards radical anarchists who regularly vandalise private and public property including embassies in hit-and-run raids.
Mitsotakis has promised a crackdown in the radical Athens district of Exarchia, traditionally a hideout for anarchists.
Greek lawmakers were sworn in Wednesday and will elect a speaker Thursday
He placed in his cabinet a tough-talking ex-socialist minister who helped crack Greece’s deadliest extremist organisation, the far-left November 17, nearly two decades ago.
The new government has also promised to amend so-called ‘university asylum’ regulations to facilitate police checks and stamp out prevalent petty crime, drugs and vandalism.
Half of the new government is made up of technocrats, and includes two former far-right politicians.
One of them, agriculture minister Makis Voridis, denied over the weekend that he had anti-Semitic beliefs after a prominent Greek Jewish official charged he had a “dark past”.
There are two new parties in parliament – Greek Solution, a nationalist party formed by TV salesman Kyriakos Velopoulos, and MeRA25, an anti-austerity party founded by maverick economist and Tsipras’s former finance minister Yanis Varoufakis.
In contrast, the neo-Nazi party Golden Dawn was shut out of parliament for the first time since 2012.
Until recently Greece’s third-ranking party, Golden Dawn is in disarray amid an ongoing trial for the 2013 murder of an anti-fascist rapper, allegedly carried out with the knowledge of senior Golden Dawn members.