Greece's designated new finance minister resigns due to ill health

 

ATHENS – Greece’s new finance minister resigned yesterday due to ill health, throwing the government’s drive to soften the terms of an international bailout into confusion less than a week after it took office.

Vassilis Rapanos (64), chairman of the National Bank of Greece, was taken to hospital on Friday before he could be sworn in, complaining of abdominal pain, nausea and dizziness.

The mild-mannered banker, who was imprisoned by a military junta in the 1970s, has a history of ill health.

The office of prime minister Antonis Samaras, who only took office last Wednesday following a June 17th election, said Mr Rapanos’s resignation on health grounds had been accepted.

Mr Rapanos said in his resignation letter: “Following discussions with my physicians, I have concluded that my health would not at the moment allow me to carry out my duties fully.”

Mr Samaras has only just emerged from hospital himself after undergoing eye surgery to repair a damaged retina.

Both he and Mr Rapanos had already said they would not be able to attend the June 28-29th European summit.

It was a worryingly chaotic start for the new government, formed after the second election in a month and facing huge domestic opposition to a harsh international bailout and steadfast European opposition to any watering down of its terms.

Only hours before Mr Rapanos’s resignation, a hospital bulletin said he would be discharged on Tuesday.

He had undergone a gastroscopy and colonoscopy, an official at the Hygeia Hospital said on condition of anonymity.

The tests “showed everything is completely normal”, it said.

According to a source from one of the three parties in the new coalition government, Mr Rapanos had been under heavy pressure from his family to turn down a job in which he would have been charged with negotiating a softening of the bailout terms.

Earlier yesterday the three party leaders had announced a transatlantic roadshow to try to persuade sceptical lenders to give them more time to repay the country’s massive debt.

The medical problems of Mr Samaras and Mr Rapanos had also forced a postponement of the first meeting between the new government and Greece’s “troika” of international lenders, originally slated for Monday. A new date has not been set.

Mr Samaras’s government, an unlikely alliance of right and left that emerged from the June 17th election, has promised angry Greeks it will soften the punishing terms of a bailout, saving them from bankruptcy in exchange for deep economic pain.

But Germany has rejected major concessions. Berlin signalled yesterday that Europe would wait for the troika’s report on Greece before taking any decisions on how to make adjustments to the bailout package to compensate for weeks of political paralysis and a deeper than expected recession.

Mr Samaras (61) emerged from hospital yesterday with a bandage over one eye. He was under orders not to fly or make the long road trip to Brussels, doctors said.

A senior official from one of the coalition parties said a new finance minister was likely to be announced today.

The government said Samaras and the leaders of his two coalition allies – the Socialist Pasok and smaller Democratic Left – would take their case for renegotiating the bailout conditions to Europe and the United States as soon as the prime minister was well enough.

At the two-day EU summit starting on Thursday, Greece will be represented by foreign minister Dimitris Avramopoulos and outgoing finance minister George Zanias in a delegation headed by President Karolos Papoulias.

Mr Avramopoulos and Mr Zanias met yesterday to discuss tactics, working from a government programme that calls for tax cuts, extra help for the poor and unemployed, a freeze on public sector lay-offs and two more years to bring Greeces deficit under control.

Much of this programme, announced by the coalition over the weekend, would unravel basic elements of a bailout agreement reached with lenders as recently as March. “We have facts and data to show the medicine is not working,” a government official said. – (Reuters)