Greek runner-up rejects coalition with top party

The leader of the Greek conservative party that gained the most votes in parliamentary elections says his efforts to form a coalition government with other parties have failed. Now, the leftist party that came in second will get a chance to cobble together a ruling alliance.

Conservative leader Antonis Samaras said Monday his attempts to convince the heads of all the parties that might have been open to a coalition did not succeed. He has handed back the mandate to form a government to the country's president.

President Karolos Papoulias will give the mandate to Alexis Tsipras, the head of the Radical Left Coalition party. Tsipras will have three days to seek a coalition.

If his talks fail, the party that came in third in Sunday's vote will get the mandate.

No agreement could force new elections next month, raising fears the fractured parliament won't be able to implement critical economic reforms agreed to underan internationalbailout deal.

Following 40-minute talks Monday with Samaras, the leader of the Radical Left Coalition, Alexis Tsipras, said the two parties' views were diametrically opposed. He demanded the cancellation of austerity measures many blame for deepening economic woes.

The two party leaders werealso meeting with the head of the third-placesocialist PASOK, the only other clearlypro-bailout party.

Tsipras' refusal to co-operate with the conservatives, while anticipated, makes it even less likely that Samaras will be able to form a strong enough coalition. It also increases the possibility that Greece will be forced to hold repeat elections in mid-June.

Sunday's protest voteagainst the mainparties in Greece by voters angry at crippling income cuts punished mainstream politicians and let a far-right extremist group into parliament but gave no party enough votes to govern alone.

The impasse could endanger the country's vital international bailout, as continued release of rescue loans depends on it speedily implementing agreed reforms and cutbacks, and raises questions over Greece's long-term participation in the euro.

The uncertaintyweighed on markets across Europe, but Greek stocks fared worse, tumbling nearlyeight per cent in early trading Monday.

Samaras'conservative New Democracy led the vote count with 18.9 per cent and 108 of parliament's 300 seats.After results were announced, Samaras said it's clear his push to meetbailout commitments for austeritywere widely unpopular.

"I understand the rage of the people, but our party will not leave Greece ungoverned," Samaras said after Sunday's vote.

The anti-bailout Radical Left Coalition, or Syriza, ended up insecond place with 16.76 per cent, givingit 52 seats.

Disaffected voters deserted PASOK and New Democracy, the two mainstays of Greek politics, leaving them at their worst level since 1974, when Greece emerged from a seven-year dictatorship.

Instead, strong gains were registered by a smaller parties on both the left and right, including the extremist Golden Dawn, which rejects the neo-Nazi label and insists it is nationalist and patriotic.

The movement has been blamed for violent attacks on immigrants and ran on an anti-immigrant platform, vowing to "clean up" Greece and calling for land mines to be planted along the country's borders. The party won about seven percent of the vote a stunning improvement from 0.29 percent in 2009 and won 21 seats.

Sunday's outcome showed widespread public anger at the harsh austerity measures imposed over the past two years in return for rescue loans from other European Union countries and the International Monetary Fund that are keeping Greece solvent. Without the funds, Greece faced a disastrous default that could have dragged down other financially troubled European countries and seen it leave the euro.

"Citizens sent a very clear message that they don't want this [austerity] policy to continue," PASOK spokeswoman Fofi Gennimata said. "It was a very great defeat for us."

'We are ready to take up the responsibility to form a new government of national salvation with two exclusive aims: For Greece to remain in the euro and to amend the terms of the loan agreements so that there is economic growth and relief for Greek society.' New Democracy leader Antonis Samaras

PASOK, which has spent 21 years in government since 1981 and stormed to victory with more than 43 per cent in 2009, saw its support slashed to 13.2 per cent. It will have just 41 seats, compared to 160 in the last election.

Sunday's turnout stood at 65 per cent a low figure for the country, where voting is officially compulsory, although no sanctions are applied for not casting a ballot. A total of seven parties won representation.

Another four small parties fell just short of the three per cent parliamentary entry threshold, getting just over 10 per cent between them.

"A nightmare of no government, with new elections looming in the background," Ta Nea daily said in its main headline.

An editorial in the respected Kathimerini daily said Greece urgently needs a national unity government that can muster the greatest possible support.

"It must aim to keep the country in the euro and also renegotiate, to whatever degree that is possible, the bailout terms," it said. "Our European partners must understand yesterday's vote and back pro-European forces."

Leading and 3rd-place parties need more support

Both Samaras and PASOK leader Evangelos Venizelos, who spent nine months as finance minister, indicated any unity government would have to include more than just their two parties.

But in a note that will likely raise alarm among Greece's international creditors, Samaras insisted any coalition should renegotiate the terms of the country's bailout.

"We are ready to take up the responsibility to form a new government of national salvation with two exclusive aims: For Greece to remain in the euro and to amend the terms of the loan agreements so that there is economic growth and relief for Greek society," he said.

Riding high on his massive gains, Syriza leader Tsipras stuck to his anti-bailout position, saying the agreement should be overturned altogether.

"The people have rewarded a proposal made by us to form a government of the left that will cancel the loan agreements and overturn the course of our people toward misery," he said before heading out to meet throngs of jubilant supporters.