New Greek government will have only brief 'honeymoon'

Significance

The conservative New Democracy (ND) party won an absolute majority in the July 7 elections, potentially ending a decade of political turbulence which featured six elections and eight governments (two of them caretaker). ND leader Kyriakos Mitsotakis is a moderate who seeks extensive institutional and economic reform.

Impacts

• Markets are reacting positively: the post-election seven-year bond was five times oversubscribed and the yield an historic low of 1.9%.
• Bank sales of non-performing loans will accelerate in the anticipated climate of economic rigour.
• Stalled infrastructure projects and privatisations will be started by next year, possibly even by the fourth quarter of 2019.
• The new administration says it will abide by the Prespa deal its predecessor signed with Skopje to end the Macedonian ‘name’ dispute.