A total of 258 lawmakers in the 300-strong chamber backed the confidence motion with 41 against, said Parliament Speaker, Filippos Petsalnikos.
“The economic crisis in our country is not a passing storm”, Papademos told lawmakers before the vote. “It will be lasting because it’s the result of imbalances which swelled over a number of years. They are the result of accumulated mistakes and political shortcomings.”
The 2012 fiscal plan, which forecasts a deficit of 5.4 per cent of GDP and a fifth year of contraction, is designed to regain the confidence of creditors and secure resumption of international financing for Greece. Standard & Poor’s yesterday warned it may downgrade 15 euro area governments on lack of decisive action to tackle the region’s debt crisis, days before European leaders meet at a December 8-9 summit in Brussels.
Papademos’s focus now shifts to the second rescue package and a debt write-down that must be completed by early next year. Talks with representatives of private creditors will be held on the terms of the swap in Athens next week, Finance Minister Evangelos Venizelos said.
The budget includes a debt-swap scenario that sees interest repayments at €12.8 billion in 2012, compared with €16.4 billion this year, or falling to 6 per cent of GDP from 7.5 per cent this year. The debt-swap plan aims to slice €100 billion off the 2011 debt burden of €350 billion.
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