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A protester wearing a Greek flag sits in front of riot police during a rally outside the Greek Parliament yesterday.!/stuffiwrote/statuses/168664950112387073

Greek PM warns of ‘economic and social catastrophe’ if MPs vote No

Lucas Papademos goes on TV to warn that the cost of a Greek default is far greater than that of a second bailout.

THE PRIME MINISTER of Greece has taken to the national airwaves to warn rebel MPs that the country faces an “economic and social catastrophe” of unprecedented proportions if they do not approve his new austerity plans.

In a televised address from Athens last night, on the eve of a crucial parliamentary vote, Lucas Papademos said the Greek economy was “just a breath away from Ground Zero” and that he was looking at the Greek public “straight in the eye”.

“The social costs that comes with these measures are contained in comparison to the economic and social catastrophe which will follow if we don’t adopt them,” Bloomberg quotes him as saying.

Greek news service Ekathimerini adds that Papademos said failure to ratify the deal would ensure that Greece would default on €14.5 billion of bonds which mature next month.

“A disorderly default would set the country on a disastrous adventure,” it quotes him as saying. “It would create conditions of uncontrolled economic chaos and social explosion.

The country would be drawn into a vortex of recession, instability, unemployment and protracted misery and this would sooner or later lead the country out of the euro.

The appeals come as five members of the 48-strong cabinet quit in protest at the measures, which include cutting 15,000 public sector jobs and slashing the minimum wage by 20 per cent.

Although the parties in government notionally command a huge majority in the 300-member parliament, a number of government MPs have already pledged to vote against the proposals, while significant numbers of others have refused to disclose their intentions.

The BBC says conservative leader Antonis Samaras has ordered his party’s 83 MPs to vote in favour of the plans, saying rebels would not be nominated to run in the parliamentary elections coming in a few months’ time.

MPs begin debating the controversial measures from noon Irish time, with the final vote taking place at 10pm. Protesters are expected to convene outside the parliament from mid-afternoon to demonstrate against the latest austerity.

The proposals have been demanded by eurozone finance ministers who have refused to sign off on the latest €130 billion bailout unless Greece radically cuts its spending.

Greece’s private bondholders have also refused to write down the value of their bonds unless the government imposes the tough new measures.

More: Greek police union calls for arrest of Troika officials

Yesterday: Greek government warns rebel MPs of “dangerous path” to default

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