European leaders working to avert a meltdown of the single currency gained some respite when Greek voters handed a narrow victory to mainstream conservatives and the chance to forge a pro-euro and pro-bailout coalition. In the single most closely watched election in years, which amounted to a referendum on whether Greece would become the first country to be forced out of the single currency, the anti-austerity radical Alexis Tsipras was also given a boost, increasing his share of the vote to more than 27%. On a momentous night in European politics, Greece’s conservative New Democracy, under Antonis Samaras, appeared to have pulled the country back from the brink of what many feared would be a national catastrophe and averted a much deeper immediate crisis in Europe.
Meanwhile, the Socialists in France, under President François Hollande, secured a comfortable absolute parliamentary majority, immeasurably strengthening the president’s hand in the looming battles over the future of Europe and its beleaguered currency. European leaders postponed their departure for a G20 summit in Mexico in order to be able to digest the outcome of the ballot in Greece, which posed the most severe challenge to the EU and the euro.
The fallout from the Greek election and the broader issue of how to avert a renewed European banking crisis and stabilise the currency will dominate the Mexico negotiations, with the US and the UK pressing the leaders of Germany, France, Italy and Spain to ward off the risk of collapse by coming up with persuasive action by the end of the month. The G20 talks will be promptly followed by a flurry of EU summitry climaxing in a European Council of heads of government in Brussels at the end of next week.