April 12, 2012
Yesterday, Greek Prime Minister Papademos visited President Papoulias to announce the dissolution of the current parliament. General elections have been called for the May 6. Elections in Greece are held in a one-round national ballot. In a brief note on the actions and implications of the Greek election, Goldman notes that the Greek political scene is undergoing a significant transformation. The traditional split between center-left (PASOK) and center-right (New Democracy, or ND)) is no longer the key dilemma for Greek voters. According to a number of recent polls, there is a significant margin of undecided voters. In addition, a number of small and new parties are projected to enter the new parliament. This has created market concerns that the Greek elections could lead to an anti-Euro government, which could interrupt the adjustment efforts underway and create risks to local financial stability.
Goldman Sachs: General Elections Called in Greece
Yesterday, Greek Prime Minister Papademos visited President Papoulias to announce the dissolution of the current parliament. General elections have been called for the May 6.
Elections in Greece are held in a one-round national ballot. The parties that manage to gather more than 3% of the votes are allowed to occupy seats in parliament. After the ballot, the President will call the leader of the party with the most parliament seats to form a government that is supported by at least 151 votes (from a total of 300) in the new parliament in a vote of confidence.
The electoral system in Greece supports the formation of stable majorities, in principle. First off, there is a 50-seat bonus to the leading party (again out of 300), which makes it easier for the leading party to gather enough support to form a stable government (in a coalition perhaps). In addition, should a large number of parties emerge that gather significant percentages in the ballot but fail to cross the threshold for entering the parliament, then the first party will gather even more parliament seats for the same amount of votes.