Greece: vote of confidence in government - as it happened

Guardian
June 21, 2011

8.54pm: Greece faces a key vote tonight in its struggle to resolve its debt crisis. A vote of confidence in Socialist prime minister George Papandreou's reshuffled government is expected to take place at 10pm BST.

If Papandreou does not clear this hurdle he will not be able to put in place the austerity measures necessary to get the EU and the IMF to release €12bn in new funds to Greece. Without these funds Athens will probably be unable to repay debts that mature in July and August, and will probably default on them, potentially triggering another panic in financial markets similar to the one that followed the collapse of US investment bank Lehman Brothers in 2008.

"Indications over the last 24 hours or so have certainly been that the government will survive, if only because the alternative would be so dire," said Beat Siegenthaler, an analyst at UBS.

However, EU finance ministers' plans to deal with the Greek debt were dealt a blow earlier today when ratings agency Fitch declared it would declare Athens to be in default if commercial banks agree to roll their loans over, as the EU ministers are planning. You can read Graeme Wearden's full story on that here, and you can read all our coverage of the Greek crisis here.

We'll have live coverage of the Greek vote and its aftermath here throughout the evening.

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