Despite fears that Greece is lurching back into crisis after its prime minister called a snap presidential election, the country’s former premier told CNBC the decision was a “wise move.”
“There is no other way to stability, we must have elections,” Costas Simitis, who was Greek Prime Minister from 1996 to 2004 leading the left-wing PASOK party, told CNBC.
Simitis’ comments come after Samaras, surprised investors by announcing a snap presidential vote late on Monday. The decision caused turmoil in Greece’s financial markets Tuesday, with the country’s main stock market plunging nearly 13 percent during the day – the worst loss since 1987 — while the yield on Greek 10-year government debt rose to 8.15 percent.
The role of the president has very little constitutional power but Samaras’ move is seen as a gamble because if his candidate does not win, an early general election could be called. At the moment, the anti-austerity, left-wing party Syriza could win, a victory that threatens the tough reform and spending cuts program that Greece was forced to adopt in return for 240 billion euros ($300 billion) in bailout loans.