ATHENS (Reuters) – Greek Prime Minister Antonis Samaras faced a political revolt on Wednesday from his ruling coalition partners after the government abruptly switched the state broadcaster off the air in the middle of the night.
Screens went black on state broadcaster ERT, cutting newscasters off mid-sentence only hours after the decision was announced, in what the government said was a temporary measure to staunch a waste of taxpayers’ money.
Unions called a 24-hour nationwide general strike in protest, and journalists across all media called an indefinite strike. Some newspapers were shut and private TV stations broadcast reruns of soap operas and sitcoms instead of the news.
Samaras’s centre-left coalition partners said they were furious at the decision to shut the broadcaster and had not been consulted. Coalition party leaders were meeting as night fell, with the suggestion left hovering in the air that they could force Samaras into a confidence vote which could bring him down.
The confrontation brought back a febrile atmosphere of political drama in a country that had seemed to be emerging from a pattern of relentless political crisis accompanying one of the biggest peacetime economic collapses in history.
Also on Wednesday, the Athens bourse was cut to emerging market status by index provider MSCI, making Greece the first country ever to lose the status of a developed market. The gesture was not only symbolically embarrassing but could also force fund managers that track indexes to ditch investments.
That followed the derailing of Greece’s privatization program earlier this week with the announcement that a gas firm could not be sold. The setbacks have reversed a rise in investor confidence that had prompted Samaras to say the risk of Greece being expelled from the euro zone was over and a “Greekovery” was under way.
Centre-right leader Samaras has ruled in fragile coalition with two centre-left parties since narrowly winning power last year. Angry at the abrupt fashion that ERT was yanked off air, the junior partners – the Socialist PASOK and the Democratic Left – said they would table a law to reverse the move.
“ERT has become a catalyst on issues of democracy, a fair state, cohesion of this government and stability regarding the course of the country,” PASOK chief Evangelos Venizelos said in a statement after a meeting of his own party. “We shouldn’t create crises without a reason out of nothing.”
One official from the New Democracy party said Samaras was considering calling a confidence vote over the issue, although a senior government official denied plans to do so.
“It could be highly destabilizing if it moves to a confrontation in parliament where the two smaller political parties have to humble themselves to avoid a next election or stick to it and force a next election,” said political analyst Theodore Couloumbis.
“BIG FAT FEAST”
The 75-year-old Hellenic Broadcasting Corporation ERT has shed viewers since the rise of commercial television and radio, and its three statewide stations had just a 13 percent combined audience share when it was switched off.
Its 2,600-strong staff include 600 journalists. Many Greeks cite the broadcaster as an example of inefficiency, overspending and jobs given in return for political favors.
Nevertheless, in a country where nearly two thirds of young people are now unemployed after years of relentless cuts and tax hikes, there is a visceral public belief that the government should not slash jobs. Greeks were stunned by the speed with which the closure was executed.
“It had to happen. ERT was a big fat feast for the political parties,” said Maria Panagiotou, a 65-year-old retiree. “But the way they did it is unacceptable. How can this happen in Europe?”
Athens journalists’ union ESIEA said its strike would end only “when the government takes back this coup d’etat which gags information”.
Some ERT journalists occupied the broadcaster’s building in defiance of government orders and continued broadcasting over the Internet, showing somber newscasters deploring the shutdown and replaying images of thousands gathered outside to protest.
ERT’s reporters from as far away as Australia appeared on air to describe the outrage of local Greek communities.
“It is our only link with our homeland,” said Odysseas Mandeakis, president of the Greek community in Zambia.
The decision to shut ERT was taken by ministerial decree, meaning it could be implemented without immediate reference to parliament. The government promised to relaunch ERT within weeks, saying it was taken off air so suddenly only due to fears that workers would damage state equipment.
“Some people are saying that what you are doing is outrageous,” Samaras said. “It’s our duty to stop what has been happening so far, stop hiding our problems and finally start dealing with them”.
A senior government official said Athens was under pressure to show visiting EU and IMF inspectors that it had a plan to fire 2,000 state workers as required under its bailout, and the ERT shutdown was the only option available to meet the target.
The European Commission said it did not seek ERT’s closure under the bailout but did not question the decision either. France’s Socialist government voiced outright condemnation, calling it “very worrying and regrettable”.
Opposition leader Alexis Tsipras called it “a coup, not only against ERT workers but against the Greek people”, and accused Samaras of the “historic responsibility of gagging state TV”.
The far-right Golden Dawn party was the only one that openly welcomed the closure, with lawmaker Ilias Panagiotaros tweeting: “ERT, that Socialist-Communist shack, is finally closing.”
MSCI CUT
The ERT crisis overshadowed MSCI’s reclassification of the country as an emerging market. The stock market traded at two-month lows after the announcement. MSCI said the Athens bourse had been too small for a developed market for two years.
Although that could mean some funds are required to sell Greek shares, brokers said the move could also trigger inflows by allowing Greece to win a share of funds allocated for emerging markets.
“Emerging market funds could not enter since Greece was classified as developed market. Now it will be on their radar,” said Theodore Krintas, head of wealth management at Attica Bank.
Yields on Greece’s 10-year benchmark bond crept back above 10 percent after Athens failed to sell state gas firm DEPA on Monday, putting it at risk of missing bailout targets. ($1 = 0.7533 euros)
(Additional reporting by Harry Papachristou, Karolina Tagaris and Tatiana Fragou, writing by Deepa Babington- Editing by Paul Taylor and Philippa Fletcher)
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